Environment and Climate Change Committee
Wednesday 28th October 2026
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10:01
10:01
10:01
Baroness Sheehan
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Baroness Sheehan
I'm the director of peers for the planet. So may I welcome our representative from mission, a project to analyze Dunkle floater events. And the final report is not publicly available as it contains confidential information. But the closed down report states, and I'll just quote a part of it. Initially, we underestimated the complexity of the problem, but we have successfully navigated these challenges. So my first question is how is Niso defining a dunk or floater event? And what assumptions have you made about the operating capacity of wind and solar?
10:01
Speaker 1
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Speaker 1
That's a really great question. And so when we look at the future, whether that be this coming winter, excuse me, or into the future, we look at a whole range of weather scenarios. We use over 40 years of historic weather. And we also work with the Met Office, who I believe has already spoken at this committee, to really work with them on a project called unseen, which is really thinking about the future weather patterns of this nation and what that might mean for our energy needs and energy production. Now, in all of that analysis, security of supply is the number one thing we have to balance across the trilemma of security, affordability, and low carbon.
But ultimately, we are never going to put forward a plan that means that security supply is at risk. So in doing that analysis, we look at all kinds of weather events extreme cold, extreme heat, long duration periods of no wind or no solar, and then work out what is the energy mix that's required for the future. And in doing so, when we think about security of supply, we look at what is likely to be expected from solar and wind on those low sun low wind days and work out what is that? Where does that energy therefore come from?
Now, today that comes from an abated gas and that is always there into the future. And we've said for many years that unabated gas is a feature of the future energy system. Now, as and when we get the new technologies such as hydrogen to power or power, CCS, the carbon capture and storage, then the more of that that comes onto the system, then the more we can displace the unabated gas. That is part of the plans currently. So what really what the headline is, is that we we plan for the future. We look at the energy sources and energy mixes.
We look at how to direct those to what assumptions we make about their power outputs in these very calm and cloudy days. And then look at what the alternative sources of energy are.
But ultimately, we are never going to put forward a plan that means that security supply is at risk. So in doing that analysis, we look at all kinds of weather events extreme cold, extreme heat, long duration periods of no wind or no solar, and then work out what is the energy mix that's required for the future. And in doing so, when we think about security of supply, we look at what is likely to be expected from solar and wind on those low sun low wind days and work out what is that? Where does that energy therefore come from?
Now, today that comes from an abated gas and that is always there into the future. And we've said for many years that unabated gas is a feature of the future energy system. Now, as and when we get the new technologies such as hydrogen to power or power, CCS, the carbon capture and storage, then the more of that that comes onto the system, then the more we can displace the unabated gas. That is part of the plans currently. So what really what the headline is, is that we we plan for the future. We look at the energy sources and energy mixes.
We look at how to direct those to what assumptions we make about their power outputs in these very calm and cloudy days. And then look at what the alternative sources of energy are.
10:03
10:03
Baroness Sheehan
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Baroness Sheehan
Okay, so we've heard a number of witnesses before us. For example, RWC in written evidence, Professor Keith Bell to the committee in person and others, they've called for the government and nyiso to define the required level and duration of resilience, publishing transparent whole system analysis. We've had repeated calls of how important it is to incentivise investment and investability into longer term projects that people have some indication of where the direction of Nyiso and the government is going to be leading them, and decisions are imminent. Now, we've heard that the seven, the 5 to 10 year time frames by which solutions have to be operable is with us today.
10:04
Speaker 1
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Speaker 1
Yes. And there's two methods by which we've given that clarity. One is in the Clean Power 2030 advice and the Clean Power Action Plan. There's requirements in there for dispatchable generation. But also what we've done this summer is we've delivered six strategic spatial energy plan pathways to the Secretary of State. And we are awaiting a decision as to which of those pathways is to be the chosen one. Now, this is very different from any analysis that Nyiso or previously Ieso has done, in that it looks to the future, it looks out to 2050 and to meet the net zero obligation in 2050.
And what it does by doing so is going to give that 2530 year forward plan as to what the energy mix of this nation could be like. And in there, it includes what each of the pathways is, is secure. So it's really awaiting the Secretary of State's decision as to which is the future direction that they would want to take the nation. Is it more of a nuclear or is it more of an offshore wind? And then the pathway, when you look at it as a whole, it's a whole energy system pathway. And therefore the requirements for resilience, for security of supply, for decarbonisation and affordability is, is part of each and every one of those pathways.
And what it does by doing so is going to give that 2530 year forward plan as to what the energy mix of this nation could be like. And in there, it includes what each of the pathways is, is secure. So it's really awaiting the Secretary of State's decision as to which is the future direction that they would want to take the nation. Is it more of a nuclear or is it more of an offshore wind? And then the pathway, when you look at it as a whole, it's a whole energy system pathway. And therefore the requirements for resilience, for security of supply, for decarbonisation and affordability is, is part of each and every one of those pathways.
10:05
10:06
Speaker 1
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Speaker 1
Yes. So we have created these pathways which clearly lays out the generation mix across the nation on a spatial basis for the next 25 to 30 years. It is not our decision as nyiso. We don't make policy, but we do provide the advice and the pathways are advice to government as to the future direction as to which we want this energy system to go.
10:06
10:06
Speaker 1
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Speaker 1
Yes. There's a there's a whole raft of data and information, as you might imagine. And some of these assumptions were provided to us by Desnos as inputs into the strategic spatial energy planning when we're doing our security supply resilience testing. As I've said earlier, we we look at a whole range of weather scenarios looking back over 40 years, we don't use an average weather year. We look at the extremities. And I think really excitingly, the important work we're doing with the Met Office to really look to the future and think what our future climate might look like, and make sure that our studies and pathways are resilient to the future weather systems as well as the ones in the past.
10:07
10:07
10:07
Speaker 1
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Speaker 1
But the security supply is first and foremost in all of our analysis. And therefore that is the basis by which we sort of start from our planning assumptions is to ensure that whatever the scenario that gets thrown upon the system, that the system is secure and able to manage that. And that is why we've said for a long, long time that unabated gas has this role to play. We have about 35,000MW today that continues through the 2030s. And then as we get out beyond 2040, that capability needs to increase as our demand across the nation increases.
As I said earlier, that in those future years, that unabated gas can be replaced by other low carbon technologies as and when we can see the the progress, the cost reductions and the suitability of all of that.
As I said earlier, that in those future years, that unabated gas can be replaced by other low carbon technologies as and when we can see the the progress, the cost reductions and the suitability of all of that.
10:08
Earl Russell
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Earl Russell
Thank you very much for your evidence in relation to your relationship with government and the six spatial energy pathways. I fully recognise that you've sent that to government, and you're waiting for the Secretary of State to give you their decision on that. My question was really about budget and the information you had at hand in terms of preparing that. We all know that there's there's big cuts coming to Disney's. Do you do you feel that you had enough information from government about their proposed budget cuts in terms of preparing your different options for the pathways, and how does that relationship work with government, and could it be improved?
10:09
Speaker 1
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Speaker 1
So we received a commission to do the work, which set out effectively the terms of reference of the Strategic Spatial energy plan. Along with that, government gave us assumptions on the demand growth across the nation over the years. It also gave us cost and deployment rates per technology type, which again is a key input into that assessment. And when we've done the analysis, we've done a whole system costing. So when the six pathways are lined up against each other, you can see the delta in terms of the cost differential between those different pathways. And that is a decision.
Now the Secretary of State is weighing up because there's lots of trade offs. The cheapest pathway may not be the best pathway because it doesn't give you other opportunities, which is why it's very much a decision for government rather than for NASA to make those trade offs.
Now the Secretary of State is weighing up because there's lots of trade offs. The cheapest pathway may not be the best pathway because it doesn't give you other opportunities, which is why it's very much a decision for government rather than for NASA to make those trade offs.
10:09
10:09
Lord Redwood
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Lord Redwood
Thank you chairman. Thank you very much for your your evidence. This question is about operating capacity of renewables. In order for that not to destabilize the system and to maximise the use of wind and solar, you will presumably need quite a lot of synchronous condensers and you presumably need grid forming inverters. Can you give us the committee some idea of the scale of that investment, the time scale of it and what it might cost?
10:10
Speaker 1
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Speaker 1
So we've been on this journey to get the system ready for a renewable system. And in fact, in 2019, we said that by the mid 2020s, we had to run the system at zero carbon. And there was a period earlier this year where we just had one gas fired power plant running in. The system was safe and secure and stable. How we got there is, as you say, we've had to procure synchronous condensers and grid forming inverters with batteries in order to provide the rotate the the physical impact of the loss of inertia to try and replace that in some way.
When you think about it, though, it becomes a huge value proposition for the consumer because to buy those products is relatively low cost. They don't produce any carbon and they displace a whole gas fired power plant. So actually, when you look at the cost benefit assessment that we have spent money on those things, obviously through the market, but the cost benefit far outweighs the the expense. And the system is as reliable, if not more reliable and lower cost to operate than the alternative.
When you think about it, though, it becomes a huge value proposition for the consumer because to buy those products is relatively low cost. They don't produce any carbon and they displace a whole gas fired power plant. So actually, when you look at the cost benefit assessment that we have spent money on those things, obviously through the market, but the cost benefit far outweighs the the expense. And the system is as reliable, if not more reliable and lower cost to operate than the alternative.
10:11
10:11
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10:12
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10:12
10:12
Lord Krebs
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Lord Krebs
Thank you very much, Lord chair. You've produced for energy Future Energy Scenarios for 2050. Which we've got in our notes here. But you also referred in response to the previous question about six strategic options. Could you just explain what the difference is and what the relative importance is and what you're expecting to happen?
10:13
Speaker 1
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Speaker 1
Yeah. So the future energy scenarios is something that we, as an electricity system operator prior to that, have published for a number of years, and it gives an envelope of possibility into the future when you're thinking about new and new technologies, stakeholder led feedback, but it isn't necessarily optimised in a whole energy system basis. The Strategic spatial energy plan following the commission and we were provided from government is a very clear whole energy system optimization. When you're looking at geospatial, environmental, societal cost and deliverability aspects. So as we bring all that together into these pathways for the strategic spatial energy plan, that is a co optimised whole energy system solution, which is looking at all of those sort of delivery aspects of that.
The other big difference is the strategic spatial energy plan, a bit like the Clean Power 2030 Action Plan. Once the pathway is chosen, we consult upon that next year. So this time next year, we're hoping that government will sign off on the Strategic Spatial Energy Plan pathway. And that will be the government's policy then, and that will be and set the background for which investment policy decisions can actions reform national pricing all hangs off the back of the strategic spatial energy plan.
The other big difference is the strategic spatial energy plan, a bit like the Clean Power 2030 Action Plan. Once the pathway is chosen, we consult upon that next year. So this time next year, we're hoping that government will sign off on the Strategic Spatial Energy Plan pathway. And that will be the government's policy then, and that will be and set the background for which investment policy decisions can actions reform national pricing all hangs off the back of the strategic spatial energy plan.
10:14
10:14
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10:14
Speaker 1
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Speaker 1
So the future energy scenarios are meet the carbon budgets apart from one. One is falling short, doesn't. But the strategic energy plan meets all of the government targets along the way. So even though there's six different pathways, all of which meet security supply and all the conditions we just spoke about, but all of them also meet the various legally binding carbon targets and the net zero by 2050 requirement.
10:15
10:15
Speaker 1
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Speaker 1
We have to balance across the trilemma so each one of them, we will never put a plan forward that isn't secure. So security supply, although there is, we have to treat them all equally. Of course, across the trilemma, all of our plans. As I've just said, they meet security supply requirements. They meet the legally binding climate targets, and we cost each of those whole system costs. So actually, as the Secretary of State has these pathways in front of her today, she can see the various costs across each of those pathways.
10:15
10:16
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10:16
Baroness McIntosh of Pickering
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Baroness McIntosh of Pickering
Thank you and welcome. Just to say I have a small holdings in National Grid, shell and BP. From what you've told us this morning and in your NASA's Future Energy Pathways Report 2025, there's going to be a long lead time for these alternative technologies. So can I ask, are we on track in Great Britain to deliver the capacity required to give resilience to a range of events, and which technologies need to be prioritised? And I would ask how they're going to be prioritised in the next ten years to increase our resilience.
10:17
Speaker 1
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Speaker 1
Resilience today. As you know, it's one of the most secure systems anywhere in the world with a very, very high level of resilience and reliability. Our future energy plans and the Strategic Spatial energy plan maintains that level. So the metric of the loss of load expectation of three hours, which is a government set standard, all of our pathways meet that. And actually in reality, when you meet that three hour loss of load expectation, in reality, it turns out to be a 0.1 to 0.2 hour loss of load expectation. So the same level of standard and resilience that we have today, and we have one of the most resilient systems anywhere in the world today.
So that remains throughout in terms of the new technologies, the strategic spatial energy plan will set out when these new technologies are required. Recognising the lead time. We can't say we need one next week when it's a 15 year lead time and some of these things, and that is a power of the strategic spatial energy plan will have. For the first time ever, we have a whole system optimised energy plan that looks beyond the next price control, the next 5 or 6 years. We are looking out to 2050, understanding what the energy system needs are in 2050, then being able to work back from that to say, well, if you want this by 2050 or by 2040, then this is when the decision needs to be made.
So really bringing that clarity, so decision making, policy making, market structures, whatever is required to bring these things to market. There is time to develop.
So that remains throughout in terms of the new technologies, the strategic spatial energy plan will set out when these new technologies are required. Recognising the lead time. We can't say we need one next week when it's a 15 year lead time and some of these things, and that is a power of the strategic spatial energy plan will have. For the first time ever, we have a whole system optimised energy plan that looks beyond the next price control, the next 5 or 6 years. We are looking out to 2050, understanding what the energy system needs are in 2050, then being able to work back from that to say, well, if you want this by 2050 or by 2040, then this is when the decision needs to be made.
So really bringing that clarity, so decision making, policy making, market structures, whatever is required to bring these things to market. There is time to develop.
10:18
10:18
Speaker 1
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Speaker 1
Sorry. So the loss of load expectation is a standard that when you bring all of this together, that the standard that the government has set is that in theory, you can have up to three hours of loss of load expectation on an individual basis throughout the year. In reality, that turns out to be 0.1 to 0.2 loss of load expectation. So it's just a it's a complex way that some measure of the reliability and resilience. We've always had a three hour loss of load expectation. We have a three hour loss of load expectation going forward.
So I don't expect the resilience of security to to waver from that in any way.
So I don't expect the resilience of security to to waver from that in any way.
10:19
10:19
10:19
Baroness McIntosh of Pickering
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Baroness McIntosh of Pickering
And just there was some criticism following the heat wave in June, and the report that was conducted by the law firm Eversheds did find cultural governance and control issues at the heart of Nassau. High levels of stress and concern within the control room as to the state of the energy industry and the longer term ability of the control room to keep the system balanced. So how are you running stress testing events to determine which technology mix is provide the greatest resilience under varying weather and system events. So if we have another heat wave of that nature, we can be relaxed about your ability to deal with them.
10:20
Speaker 1
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Speaker 1
So we welcome the Eversheds report and the findings. And we've sort of taken on board all of their recommendations. I mean, safe to say, though, as I've said already, all of our forward looking planning made sure that whatever the weather scenario that we we are receiving, we have a secure and reliable system and we have mechanisms. We have a capacity mechanism to ensure that capacity is available at four years ahead. And there's market structures for that, that the government runs to ensure that security of supply. But as as I've said already, the strategic spatial energy plans, which is either forward looking piece, all of those meet the same level of reliability and security standards we have today.
The technology, we are technology agnostic. It's the characteristics of the technology that's important. So if it's dispatchable, it's not reliant upon the winds, whether it's unabated gas, gas with carbon capture and storage , or the creation of hydrogen, the storage of hydrogen and hydrogen to power. All of those have the same characteristics of electricity and security of supply.
The technology, we are technology agnostic. It's the characteristics of the technology that's important. So if it's dispatchable, it's not reliant upon the winds, whether it's unabated gas, gas with carbon capture and storage , or the creation of hydrogen, the storage of hydrogen and hydrogen to power. All of those have the same characteristics of electricity and security of supply.
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10:21
Baroness Whitaker
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Baroness Whitaker
Thank you very much. Your future energy scenarios says that there's up to four gigawatts of tidal operation capacity in 2050. That's a bit beyond the ten years, but they're high up front costs and limited subsidy. Now, presumably, if the subsidy were less limited or better targeted, that might bring the upfront cost down because they could scale up more and therefore they could come closer than to 2050. Is that something that you are examining.
10:22
Speaker 1
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Speaker 1
In the strategic spatial energy plan? Sorry, it's the same answer. This is setting out the future energy requirements for the nation. So the technology types is provided by government as to what we should consider in there. That is part of that process. The Strategic Spatial Energy plan is reviewed every three years. So as new technologies, whether that be tidal or other, then they as they get to be affordable, to be credible, to be timely, then they will come. They may feature in future strategic spatial energy plans, but that is the that is a vehicle. Now we've got a strategic spatial energy plan that is a vehicle by which every three years we refresh our future vision as to where we're heading to for 2050.
But obviously, decisions are need to be made today to have a nuclear machine by 2040. Then those decisions need to be made today. And that's what the Strategic Spatial energy plan will do. And really provide that clarity as to the future direction and then what those decisions are needed in the next three years.
But obviously, decisions are need to be made today to have a nuclear machine by 2040. Then those decisions need to be made today. And that's what the Strategic Spatial energy plan will do. And really provide that clarity as to the future direction and then what those decisions are needed in the next three years.
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10:23
Lord Ashcombe
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Lord Ashcombe
Thank you. And you mentioned that we had one of the most resilient systems. I'm interested A how you measure that. And B when we're reliant on about 10% over any one year of power coming in from Europe on interconnectors, if if suddenly Europe isn't there, what happens next? Because it's a very significant amount of power.
10:24
Speaker 1
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Speaker 1
So in terms of the first question, we measure by the loss of unsupplied energy from the transmission system. And today our reliability is 99.69%. What I mean by that. So if we if there's a transmission fault. So the big highways of the electricity system, if there's a fault on there and we lost a city, for example, how long we lose the megawatt hours we've lost, that all gets calculated compared to the volume of capacity across the year that needs to be delivered.
And we're at 99.99996% of all of that power is delivered.
And we're at 99.99996% of all of that power is delivered.
10:24
Speaker 1
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Speaker 1
Or similar? Some are the same. Some other countries are well below that. So anyway, so that's how we sort of measure that in terms of interconnectors. Like interconnectors are a hugely flexible, invaluable tool that we have at our disposal in sort of managing day to day operations of the grid. And they provide access to low, low cost, low carbon. But also when we are producing a lot of low cost, low carbon generation, we can export into Europe as well. However, there is a case, as you say, where we could be experiencing a challenging time in the system as well as across Europe.
And that's why in the capacity mechanism, we de-rate the capacities of those interconnectors, so we don't rely on them in our most stressed situation, we don't rely on 100% of that generation or power to come across the interconnector. So we rely on much less of that. So it varies on the interconnector. We've done lots of analysis to understand what the correlation might be between a weather event here and one across Europe. So we publish all of that information, which again, we can share in writing because it is different per interconnector.
And that's why in the capacity mechanism, we de-rate the capacities of those interconnectors, so we don't rely on them in our most stressed situation, we don't rely on 100% of that generation or power to come across the interconnector. So we rely on much less of that. So it varies on the interconnector. We've done lots of analysis to understand what the correlation might be between a weather event here and one across Europe. So we publish all of that information, which again, we can share in writing because it is different per interconnector.
10:25
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10:26
Speaker 1
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Speaker 1
And our system ensures we agree the capacity. So security supply is still a requirement for governments governments accountabilities for security of supply. So that's why the capacity mechanism we advise government as to what is the volumes of capacity that should be procured through the capacity mechanism, but ultimately that relies on government to then make that decision as to the amount we procure, and then we administer the process to procure the amount. That's the capacity mechanism.
10:26
Earl Russell
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Earl Russell
Thank you very much. In relation to the Eversheds report, I know it's just that some of the accusations before that report was written have turned out to be misguided. Could I ask you to comment? I think it's important that the debate about renewables isn't one that turns into a debate that undermines the actual reliance of our energy system. And on that basis, would you agree with the statement that there's actually more work that could be done, actually, to improve communications to these old politicians, to make sure that political discourse isn't putting out false accusations about the reliability of our energy system?
10:27
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10:27
Speaker 1
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Speaker 1
No, just to say. I mean, we are very transparent. We run one of the most transparent energy systems anywhere in the world. A lot of our data is available so people can dive into it and look at it. We always our plans and our policies within the control room and around the control room, resilience and reliability and security supply is the number one thing that in that control room, we will always protect above anything else.
10:27
Baroness Sheehan
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Baroness Sheehan
Okay. I just want a quick supplementary on this. It's on your report on resource adequacy in the 2030s, which says that new low carbon technologies that can provide clean energy for extended periods are needed, and that while some investment is coming through and I quote, further action is needed to develop a pipeline of new low carbon technology projects ready for large scale deployment in the 2030s. My question to you is, by whom is further action needed?
10:28
Speaker 1
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Speaker 1
So yeah, so our job is to provide the advice and Clean power 2030. We provided a a generation mix that would work, which included some of these nascent technologies, which was again, driven by government. We could see the investments in carbon capture and storage that was happening at the time, the investments in the hydrogen allocation rounds. So we built those into the plan. So we now we have certainty about the role that those technologies can play in 2030. Once you look at the strategic spatial energy plan, we build from that and we look out to 2050, and therefore there's a pipeline very clearly as to what is required by each of those technologies, depending on the chosen pathway.
And then it's for government and the market to then see that opportunity, then embrace that and build towards it.
And then it's for government and the market to then see that opportunity, then embrace that and build towards it.
10:29
Baroness Sheehan
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Baroness Sheehan
I suppose what I'm getting to is we've heard a fair amount of criticism of nyssa's lack of decisiveness, lack of transparency and openness in the process, in the decision and delay in making those decisions. So I'm really what we want to try and do. I think this is something that this committee could really help with, is to try and clarify where the blockages are and where the decisions need to be, you know, where we need to press to make sure that the lights don't go out.
10:29
Speaker 1
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Speaker 1
I can assure you, the lights we planned so hard to ensure the lights don't go out. And because we've got the unabated gas fleet still available to us, we always have that backup and resilience sort of background to that in terms of decision making. I mean, we've been very clear in Clean Power 2030, we published our report within four months of being asked to publish it, very clear advice, which then a month later became the Clean Power 2030 action plan owned by Dennis and Chris Stark. And the team at the time were then responsible for delivering against that.
As you look to the future, the strategic spatial energy plan, yes, it is a year later than expected, but we had some revised input data a year ago, which meant we had to go back to the drawing board and start over. The quality of this report that we published in August, once you get to see it is incredible. And the quality and the resilience and the robustness of the data analysis that will be available once the decision is made, should give everybody great confidence and is giving government great confidence to date that actually the advice we are providing to government is sound and based on good analysis and good data.
As you look to the future, the strategic spatial energy plan, yes, it is a year later than expected, but we had some revised input data a year ago, which meant we had to go back to the drawing board and start over. The quality of this report that we published in August, once you get to see it is incredible. And the quality and the resilience and the robustness of the data analysis that will be available once the decision is made, should give everybody great confidence and is giving government great confidence to date that actually the advice we are providing to government is sound and based on good analysis and good data.
10:30
Lord Jay of Ewelme
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Lord Jay of Ewelme
Thank you very much. I should declare an interest as a former member of the Board of Main board of EDF in in Paris. I wanted to ask a question about the strategic spatial energy plan, but I think you've just answered much of what I was going to ask. But just one. It seems to me there are two sort of issues in this. Two main issues in the strategic spatial energy plan. And how do you provide the incentives? How do provide investors with the certainty that they need on existing technologies and how at the same time, do you do the work on nascent technology, the R&D and nascent technologies?
I mean, can you can you do both of those? That's the first question. The second question, you say that it's Ofgem who makes the decisions about this. Do you or the minister makes decisions? Do you work with them as they do that, or do they do that on their own? What's the sort of interrelationship when the decisions are made?
I mean, can you can you do both of those? That's the first question. The second question, you say that it's Ofgem who makes the decisions about this. Do you or the minister makes decisions? Do you work with them as they do that, or do they do that on their own? What's the sort of interrelationship when the decisions are made?
10:31
Speaker 1
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Speaker 1
So on the first question, having a having a plan provides investor certainty, right? Because there will be a plan for the first time, it is approved by government and endorsed by the regulator. So again, we have the policy makers, and then the regulator then funds the networks in order to make that happen. And we've also got reform national pricing, which has been developed as well, and reform national pricing. The advice and guidance from government on that is again referred to the Strategic Spatial Energy plan, something like well over 100 times in their sort of advice.
So really putting the Ssrp at the heart of that, the strategic spatial energy plan is also referred to in the National policy statement. So from a Planning Inspectorate point of view, if you're bringing forward one of these very large projects, the Planning Inspectorate should refer to the Strategic Spatial Energy Plan and whether that project features in there or not. And if it does, then it's aligned with the government ambition. So the whole purpose, one of the key drivers of the strategic spatial energy plan is to create that long term investor certainty, to build the supply chain, to get the skills and development into this country and to grow the economy on the back of that.
So we don't, as Nisa, we don't do the research and development into new technologies. That could be something that government might be wanting to fund to, to build up to. So it gets to a credible level. What is in the strategic spatial energy plan? Deliverability is a key facet to that. So understanding the technology readiness of the of the technology types that are coming into the Ssrp is really important. But because it is a plan that we want people to work to, that we want credible technologies that can be delivered within the timescales that it states in the strategic, especially.
So really putting the Ssrp at the heart of that, the strategic spatial energy plan is also referred to in the National policy statement. So from a Planning Inspectorate point of view, if you're bringing forward one of these very large projects, the Planning Inspectorate should refer to the Strategic Spatial Energy Plan and whether that project features in there or not. And if it does, then it's aligned with the government ambition. So the whole purpose, one of the key drivers of the strategic spatial energy plan is to create that long term investor certainty, to build the supply chain, to get the skills and development into this country and to grow the economy on the back of that.
So we don't, as Nisa, we don't do the research and development into new technologies. That could be something that government might be wanting to fund to, to build up to. So it gets to a credible level. What is in the strategic spatial energy plan? Deliverability is a key facet to that. So understanding the technology readiness of the of the technology types that are coming into the Ssrp is really important. But because it is a plan that we want people to work to, that we want credible technologies that can be delivered within the timescales that it states in the strategic, especially.
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10:33
Speaker 1
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Speaker 1
No, because that's why we're on a three yearly cycle, the strategic spatial energy plan. So then if we can tweak the future years to, to be to adapt and to embrace that new technology type. Okay. And in terms of working with government, obviously government commissioned us through the Strategic Spatial Energy plan. They are part of the governance, along with the Welsh and the Scottish Government, to understand how we've developed, developed these pathways and what those say, so that governance and that insight and and awareness of what we're doing is very clear. We work very closely together with with government and with Ofgem, because obviously the result of the strategic spatial energy plan leads to network investment.
And that's why the regulator needs to be fully involved in that.
And that's why the regulator needs to be fully involved in that.
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10:33
Baroness Coffey
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Baroness Coffey
Thank you, Mr. Leslie. I'm conscious your boss is giving evidence in the other house at the moment. So I'm sure it's not been the most comfortable of weeks. But I wanted to ask a bit more about the strategic spatial energy plan. So a fortnight ago, I think it's somebody called Craig Dyke who may well work for you. Put out a comment, an explanation about the emergency assistance that was requested twice. And I appreciate that. It's a not a routine thing, but not something to be alarmed about. But the key thing that stood out to me was that there wasn't enough electricity in London.
So we were calling on the French through the interconnectors, and I just wanted to get a sense in terms of engineering, when there's all these different things going on, all the projects that have been approved of interconnectors, stuff that's out at sea, why even more from an engineering perspective, isn't basically plugged in a lot closer to London. There's quite a lot happening up on the Suffolk coast where I live, but it's not the only place. It's Kent and similar, and I just wanted to get a sense of why we couldn't do a lot more on the brownfield existing sites, or indeed create something particularly special for London directly, rather than have the engineering issues.
Sorry, the supply issues that are ongoing.
So we were calling on the French through the interconnectors, and I just wanted to get a sense in terms of engineering, when there's all these different things going on, all the projects that have been approved of interconnectors, stuff that's out at sea, why even more from an engineering perspective, isn't basically plugged in a lot closer to London. There's quite a lot happening up on the Suffolk coast where I live, but it's not the only place. It's Kent and similar, and I just wanted to get a sense of why we couldn't do a lot more on the brownfield existing sites, or indeed create something particularly special for London directly, rather than have the engineering issues.
Sorry, the supply issues that are ongoing.
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Speaker 1
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Speaker 1
When we look at the design of the network, we have to take into account the deliverability, the environmental and societal impact of that network. And obviously this infrastructure isn't low cost. It costs a lot of money. It isn't just for London. It's part of the energy mix of the nation. And therefore we have to look at the flows, the costs of deliverability and the impact on the environment. So all of those factors come into play. Once we have a strategic spatial energy plan, we then create the centralised strategic network plan that then sort of takes that energy plan that government will approve, hopefully the pathway very soon.
And then we overlay that and say, well, if that is the pathway for the future, then here is a network that is needed to support that.
And then we overlay that and say, well, if that is the pathway for the future, then here is a network that is needed to support that.
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Speaker 1
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Speaker 1
So obviously it's a dynamic system. There might have been a system circuit out for maintenance at that time. So most times, obviously we can supply London and we do supply London without emergency assistance. But the system is dynamic and it's evolving, and we're having to invest heavily in the network and maintain what is now an ageing network. So I'm sure I don't know the exact system operation conditions on that day, but there could be a reason for it.
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Baroness Rafferty
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Baroness Rafferty
Thank you, Mr. Leslie. You mentioned the word deliverable and in relation to the strategic Spatial and Energy plan, and I just wondered about the workforce. Do you have any concerns that we don't have an adequate supply of highly skilled technicians and workers needed to actually deliver the network that you so described?
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Speaker 1
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Speaker 1
I mean, it's not really a question for Niso, but I do work very closely with my network colleagues, and I know that is a challenge for them. But again, that's why the Strategic Spatial Energy Plan and the subsequent subsequent centralised strategic network plan is really important because it gives that longer term certainty. So supply chain skills and development, you can start to invest with certainty that this isn't just for a five year price control. This is something which is going to be enduring for a number of years. And that's why having a 25 year energy plan for the nation, we believe is critically important for all the things we've spoken about this morning, but especially that sort of investment, supply chain and skills development.
Very much.
Very much.
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Lord Trees
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Lord Trees
Thank you very much, chair, and thank you very much for coming. I'm not an electrical engineer, but I do know we cannot store electricity at scale, and I regard the national grid as a wonder of the modern world. So thank you for all you've done historically. But the increasing reliance on intermittent sources of power generation are producing real challenges. So what's your view about the value of a strategic. Sorry, what's your assessment of the whole system costs of developing a resilient, low carbon electricity network? And how will those measures affect energy costs for the consumers?
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Speaker 1
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Speaker 1
As I said already, we look even the Clean Power 2030 action plan had a whole system cost assessment alongside that, which again, depending on your sort of forward future pricing of gas obviously really has a big impact on the value of that. And I think we would not have forecast a greater than £2 a therm for gas as it is today. And yet even in the Clean Power 2030 action plan, even with all the capital investment, it was still the right thing to do. As you look at the strategic energy plan, looking out to 2050 again, we've done a similar whole system cost of that, which includes the capital, the operation and the fuel cost.
And again, you'll be able to see the trade off and the differences between those pathways. So it's all factored in as part of our strategic planning.
And again, you'll be able to see the trade off and the differences between those pathways. So it's all factored in as part of our strategic planning.
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Lord Trees
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Lord Trees
So one of the problems about relying on more intermittency is that we also need to invest more in storage and alternatives and dispatchable sources. And both have constraint costs which are very considerable. There must be a sort of sweet spot where we have a certain amount of assets for wind, certain amount of assets for solar, and a certain amount of assets. Have you worked out what that sweet spot is and how close to achieving it are we?
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Speaker 1
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Speaker 1
That's what the strategic energy plan, that's exactly what it does. But you need to understand what the overarching sort of government policy is around nuclear, floating offshore wind and those other aspects. As I said earlier, if you've got much more nuclear, whether it's small, modular or another large nuclear generator, then obviously that is running 24 over seven. So your requirements for storage are less, but it's obviously an expensive. So that's all part of the strategic spatial energy plan to really work out what is the optimum level depending on the energy mix that as a government we need whilst meeting security supply, low carbon and low cost system for you.
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Speaker 1
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Speaker 1
Since the pathway is, as you might imagine, with the six pathways, some of them rely very heavily on wind and solar, and some less so because they're relying much more on nuclear and other low carbon dispatchable generation. So you can't there is no single answer, because it depends on the whole energy system as to what is the energy mix we have as a nation, and also building on the flexibility that consumers can provide and industry can provide as well. So it all needs to play into that mix. And these pathways are trying to make off that balance and trade off.
And which is why that's, again with the Secretary of State for a decision.
And which is why that's, again with the Secretary of State for a decision.
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Lord Redwood
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Lord Redwood
Thank you. And I've seen an estimate that grid costs for a bill payer might go up by about 50% by 2030 to accommodate your obvious need for very big upgrade and expansion of the grid. Can you comment on that figure? Because it would be nice for us to have from yourselves some idea of what's going to happen to to bills.
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Speaker 1
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Speaker 1
Obviously, as we invest in the network, there is more to be recovered from the network, but equally, the demand is growing on the network. So actually there's more consumers consuming energy from the network. So your cost per megawatt. So there's a fine balance. Again we can write to you with our latest forecasts on. So there'll be I can't recall the numbers right now, but we can write to say what that's going to be.
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Baroness Sheehan
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Baroness Sheehan
Further. I just want to talk a little bit about demand reduction. Is there does have a role in influencing the public's behaviour or communicating with the public when it would be useful for for them to boil a kettle before the break. So, you know, just just smoothing out demand. And I think that's quite effective over short term intermittency requirements. Is there a role for demand reduction for these longer term events? I'm thinking more about future developments like using household batteries more effectively and the energy stored within them.
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Speaker 1
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Speaker 1
The way that it works today is that the market, so your supplier, whether it be OVO or octopus or whomever it might be, will be looking at the forward futures over the next 24 hours or so and looking at where the price spike is high, because actually, we are bringing on the last few of our sort of dispatchable gas generators and driving the price high. And octopus and OVO will say, actually, if we can reduce the demand across our consumer base, we can reward the consumers for doing so. And the cost of supply is less.
And obviously that is then reducing the peak, so enabling a greater resilience system. So it is still very nascent. But I mean, we are again, one of the most advanced in the world with over 2 million subscribers across those suppliers providing support to the system. So almost daily at the moment, I'm getting an email from octopus saying, can I reduce my demand between 6 and 7 p.m. in the Clean Power 2030 advice, we said that we need about 12,000MW, 12,000MW of that service across industry and domestic demand for 2030. And that is a huge benefit because obviously, it does reduce your reliance on unabated gas over those peak periods.
And obviously that is then reducing the peak, so enabling a greater resilience system. So it is still very nascent. But I mean, we are again, one of the most advanced in the world with over 2 million subscribers across those suppliers providing support to the system. So almost daily at the moment, I'm getting an email from octopus saying, can I reduce my demand between 6 and 7 p.m. in the Clean Power 2030 advice, we said that we need about 12,000MW, 12,000MW of that service across industry and domestic demand for 2030. And that is a huge benefit because obviously, it does reduce your reliance on unabated gas over those peak periods.
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Baroness Sheehan
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Baroness Sheehan
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Speaker 1
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Speaker 1
So we are looking at that whole sort of forward looking, what that demand might be, looking at the technologies that we will have to heat our homes and how flexible they can be. But really that is, again, it's for us to set out the requirements and then for markets to deliver against that requirement.
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Baroness McIntosh of Pickering
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Baroness McIntosh of Pickering
It's just on this point, if I may. There is an issue in rural areas where smart meters don't work. So when we have these plans based on demand, could we just bear in mind that, you know, the smart meters don't work because the signal isn't well enough. And then they come up with all these highfaluting ideas to put in something else that then needs something else. So we just feel very aggrieved, you know, that we can actually have a system whereby we would benefit from these wonderful things coming out.
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Baroness Sheehan
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Baroness Sheehan
Thank you. I do have one final question. We're just on the on the minute, the strategic spatial energy plan and will map potential electricity and hydrogen generation storage infrastructure for Britain. The plan is being delivered by Nisa by yourselves and is due in the latter half of 2027. Who sets that time frame and is that is that satisfactory, given the urgency for the decisions to be taken immediately?
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Speaker 1
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Speaker 1
We were commissioned by government to do the work. As I say, there was a change half a year into that commission with some more better data that we felt was so significant. It was better to to pause and to redo the analysis. So, as I say, we have delivered our work to Secretary of State. We did that in August of this year. The Secretary of State is now debating as to which of those pathways to take. We expect to get a decision on that towards the end of this year, and then throughout 2027, it will become public, and we'll be consulting upon that chosen pathway.
So although it won't be set in stone until the end of 27, actually, people will get to see the trajectory, the direction of travel and start to refine and to build their plans, hopefully from the early part of next year.
So although it won't be set in stone until the end of 27, actually, people will get to see the trajectory, the direction of travel and start to refine and to build their plans, hopefully from the early part of next year.
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Baroness Sheehan
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Baroness Sheehan
Thank you. We, we, we wait in anticipation. I do very much hope that it won't be the same story as was with the land use framework, which was put back and put back and put back. This is really important. So I hope Lisa will do everything to make sure that they do not hold up delivery. And with that, I say thank you very much for being taking time to be with us today and for being so patient with our questions.
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Speaker 2
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Speaker 2
Oh, good morning everybody. Thank you for the opportunity. Coming talking to you today. My name is Peter Bingham. I'm the engineering and technology director at the energy regulator Ofgem. Very much on the infrastructure side of the house. I am an engineer, so in some ways quite unique in the civil service. I lead a team of engineers at Ofgem. We regulate a very technical industry and in order to do that properly and set effective policy, it is important that we've got, you know, technical know how within the regulator. And that's what me and my team bring.
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Speaker 2
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Speaker 2
Okay. So we you know, we recognise we're on a transition towards, you know, a more sustainable energy system using renewables. And, you know, lots of lots of renewables are being brought onto the system. And we're very conscious that the intermittency of those renewables requires dispatchable plant of, of, of all different sources in order to sort of fill the gaps to ensure demand is secure. We're well aware of this situation. And, and, and, and the need for strategic planning to ensure that we have the right mix going forward to, to ensure that the long standing security of supply that we've enjoyed in this country continues into the future.
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Lord Ashcombe
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Lord Ashcombe
Thank you for that. And sort of a follow up is that in the gas network, there's a 1 in 20 year plan of keeping things running, and I'm not sure that there is the same in in the electric world, if I can put it like that. So what reliability standards should consumers expect as a greater proportion of renewables is added to the grid?
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Speaker 2
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Speaker 2
Okay. So yes, the 1 in 20 standard is very much a gas standard. It's about ensuring that the gas network and supplies of gas can meet a sort of 1 in 20 very severe sort of winter situation in terms of electricity, the the government sets the reliability standard, the three hour loss of load expectation. And that's been with us for ten years or more. It's how we plan the, the, the provision of, of generation capacity to meet to meet the peak demand that is forecast.
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Lord Ashcombe
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Lord Ashcombe
I'm still not sure that we've really got there, because if you have a taking the gas example, you have you have something for gas, which which today is a very important part of our energy needs and is significantly higher than electricity. But for the electric world, you're saying, well, we think it's three hours, but I'm talking about when things are really bad. It could be not only with the Dunkel flat situation, but I am worried about all the interconnectors. And we're, as you heard earlier, we have 10% of our power coming in from interconnectors on average through the year.
If Europe has a problem, needs its power. In Europe we have a Dunkel flat, a situation as an example here. What's the problem? What probability do you work to to to work out your worst case scenario?
If Europe has a problem, needs its power. In Europe we have a Dunkel flat, a situation as an example here. What's the problem? What probability do you work to to to work out your worst case scenario?
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Speaker 2
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Speaker 2
That is the loss of load expectation, which is a probabilistic reliability standard that they need. So use in order to. And they run tens of thousands of scenarios of, you know, different different weather conditions and different generation availability, different interconnected conditions in Europe in order to sort of ensure that virtually all bases are covered to meet that reliability standard.
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Speaker 2
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Speaker 2
The, the yeah. The loss of load probability is, is a, is, is a expectation is a probabilistic measure. In effect, there's a distribution of likely demand going all the way to very extreme high demand. And then there's a distribution of available generation. And effectively the one is looking to cover the other almost in its entirety. And this loss of load expectation is where there is a gap, where it's deemed that it's effectively not value for money to go beyond that. He although as as your last witness said, we've actually, through the capacity market, recently procured more capacity than was needed by that reliability standard.
But it's a very statistical piece of work that they do to work out what plant is needed to cover the vast majority of these scenarios, both on the generation and the demand side.
But it's a very statistical piece of work that they do to work out what plant is needed to cover the vast majority of these scenarios, both on the generation and the demand side.
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Lord Redwood
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Lord Redwood
Yes. Thank you. The security and quality of supply standards and supplies have recently been relaxed. I think number 35 and number 36 documents relaxed, thermal and voltage constraints and voltage limits. Can you that was presumably to accommodate renewables. Can you can you explain it to us? And has it increased the risk for the system as a whole?
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10:55
Lord Krebs
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Lord Krebs
Thank you, chair, thank you very much for coming to give evidence to us. Our interest is really on ultra long duration energy storage for these shorter periods. And yet most of the discussion has been about covering shorter term gaps in wind and solar. And relevant to that, the cap and floor mechanism that you announced in your mind a two decision in June this year is really focused on shorter duration energy storage rather than ultra long term duration energy storage. And I wondered if you could say why you're not focusing on the ultra long and what alternative mechanisms you're considering, if any, to support storage solutions that can deliver, for example, 100 hours or more.
These may be storage solutions that are used very, very rarely. And therefore the owner of them is sitting on an asset which is not yielding any, any returns.
These may be storage solutions that are used very, very rarely. And therefore the owner of them is sitting on an asset which is not yielding any, any returns.
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Speaker 2
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Speaker 2
Okay. So, so the long duration storage window, one that you just referred to, it didn't limit the duration. It was, it was looking for solutions that would provide storage for eight hours or more. So technologies that could provide longer duration could come forward. And some did . Indeed. And as part of our our draft determinations, we've got projects in there that are up to 30 hours in terms of longer duration. You know, I, I believe that there is certainly a benefit certainly of exploring longer duration, as you call it, ultra long duration energy storage. When we, when we, we published in the summer, we talked about doing a consultation on how we might evolve the long duration energy storage for a potential future round.
And those, you know, how, how we might make that more accessible to longer duration technologies might be considered as part of that, that design consultation, the the last witness talked about the strategic spatial energy plan, and that will, in theory, set out requirements for storage. Certainly the clear power 2030 had a lot of storage requirements set out into it. So to the extent there is a need for lots of storage on the system to effectively absorb surplus renewables and then be able to dispatch that during periods of low renewable output, that that that kind of technology is something that we, I think collectively with government need to think about whether or not that kind of mechanism is the right mechanism to bring forward that kind of investment, or whether we need to adapt other mechanisms or introduce new mechanisms to encourage that sort of technology.
And those, you know, how, how we might make that more accessible to longer duration technologies might be considered as part of that, that design consultation, the the last witness talked about the strategic spatial energy plan, and that will, in theory, set out requirements for storage. Certainly the clear power 2030 had a lot of storage requirements set out into it. So to the extent there is a need for lots of storage on the system to effectively absorb surplus renewables and then be able to dispatch that during periods of low renewable output, that that that kind of technology is something that we, I think collectively with government need to think about whether or not that kind of mechanism is the right mechanism to bring forward that kind of investment, or whether we need to adapt other mechanisms or introduce new mechanisms to encourage that sort of technology.
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Lord Krebs
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Lord Krebs
Chair, if I may, I'd like to ask a couple of short follow up questions. One is, is about scale. So how much whether it's ultra long or long duration energy storage, how do you distinguish those? What scale is needed? And as I understand it, the current installed LDS ELDES is amounts to 23.9GW hours of storage capacity. And that relates, as I understand it, to, the UK's total daily requirement is about 700 gigawatt hours. So it's tiny. So what sort of scale is envisaged in in the longer term for storage, if we have to meet the capacity demand of the whole country for, you know, ten days or something like that.
10:59
Speaker 2
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Speaker 2
Well, the answer in theory comes through this strategic planning approach. I, as I say, we, you know, we are looking to build lots and lots of renewables. We've got a huge resource for renewable electricity around our shores, and we want to take advantage of that. How we then fill those gaps in when renewable output is low is there are lots of different technologies available, ranging from, you know, unabated gas plant hydrogen to power, gas. Q s benefits from interconnections with other countries. And of course, storage is one of the solutions and demand side response, of course, as well.
But in terms of storage, you know, I think we all we all agree that, you know, we're going to have periods of surplus renewable output. And wouldn't it be great to be able to store all that renewable output
But in terms of storage, you know, I think we all we all agree that, you know, we're going to have periods of surplus renewable output. And wouldn't it be great to be able to store all that renewable output
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Earl Russell
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Earl Russell
We're going to have periods of surplus renewable output. And wouldn't it be great to be able to store all that renewable output? And instead of burning gas, to be able to then draw on those stores. So yes, the strategic energy plan should set out a requirement for storage going forward. And then it is for. government and perhaps Ofgem to think .
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Earl Russell
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Earl Russell
You chair. I have Earl Russell and Lord Redwood. Thank you very much for your evidence this morning. I was really interested in your responses to Lord Krebs's questions. I mean, it does. I just want to ask you a general question, if I might. It does strike me that the in terms of. I recognise the learning you're doing and other people are doing in response to the last consultation. But it does strike me that the longer the term that we want energy storage for, the greater the set of problems that we face in achieving that outcome.
So it's it's new technology. The cap and floor system doesn't necessarily work. Planning it with all the plans and the spatial energy plans and everything else. So I guess I just want to come back slightly. And do you think that in relation to, you know, I mean, Lord Krebs has said ultra long energy storage duration, but do you think there is a real need for do you think this is a bit of a special problem? Is there a need for a bit of fresh thinking. between government and all the various different agencies involved? It does strike me that this could do with greater cooperative work and thinking about it, because there just are a whole set of particular problems and, you know, picking technologies and all the rest of it.
Sorry, that's a bit of .
So it's it's new technology. The cap and floor system doesn't necessarily work. Planning it with all the plans and the spatial energy plans and everything else. So I guess I just want to come back slightly. And do you think that in relation to, you know, I mean, Lord Krebs has said ultra long energy storage duration, but do you think there is a real need for do you think this is a bit of a special problem? Is there a need for a bit of fresh thinking. between government and all the various different agencies involved? It does strike me that this could do with greater cooperative work and thinking about it, because there just are a whole set of particular problems and, you know, picking technologies and all the rest of it.
Sorry, that's a bit of .
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Earl Russell
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Earl Russell
Because they're a very nascent sort of technologies. The, the may. absolutely be the case for something similar in this space to sort of help those. technologies come forward as, as your previous witness talked about, the CEP being revised every three years to bring on new technologies available. But the trouble is, how do you get those new. technologies to a point where you're going to include them in your plan? You need to you need you need a seed at some point.
And, and some of these ultra long duration storage perhaps needs that kind of .
And, and some of these ultra long duration storage perhaps needs that kind of .
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Lord Redwood
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Lord Redwood
Approach, as you suggested. Okay. Yes. Thank you. Just to clarify my former question, I've just checked on the website to give you a more precise reference, and it's GSO35 and GSO36. The numbers I thought, and I think it would be a good idea if the regulator would give us a view of the current changes underway at Nyiso on this, given how relevant .
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Earl Russell
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Earl Russell
Your comment would be extremely helpful on when you've had a chance. There are. I don't have those two modifications. I believe they're probably. modifications to the s s s, which is the security standard. There are certainly one that we recently approved actually, which is around voltage. And that might be the question. And .
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Earl Russell
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Earl Russell
To actually slightly widen the voltage tolerance is one of the ones I referred to. Sorry sorry sorry. Yes, yes we we approved that and that and that that would get that was that was to give the the Nissan more operational. flexibility within safe operating limits on the on the. 275 kV network. So yes, I'm aware of that. And that is that is something that we've recently approved.
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Earl Russell
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Earl Russell
Deliver value for money for consumers? Okay. So that that comes back to strategic planning. You know, the ultimate objective. There are various objectives, but one of the ultimate objectives is, is, is to ensure. affordability to, to keep to keep bills down. Another one will be around security supply. Another one will be the sort of environmental impacts of carbon. So there are, you know, there are various constraints in sort of defining these pathways.
But, you know, as.
But, you know, as.
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Baroness Whitaker
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Baroness Whitaker
Is in that pathway. It is optimised. So while we're waiting for the decision to be made, can what's your view about the sufficiency of existing markets? I must say our evidence so far has been nearly. unanimous that they're not really working as they ought to for various reasons, but long. duration energy storage, which is on almost all of them.
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Earl Russell
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Earl Russell
Okay. So so so we're looking at so so okay, so so the, the whole long duration energy storage. initiative is, is, is, is a. recognition that the sort of market barriers for bringing that kind of investment were there. So LDA is about trying to break down that barrier and create a, a vehicle that will attract.
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Earl Russell
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Earl Russell
Long duration energy storage. As I said, this is this is the first window we will be. consulting on how we might evolve the, the rules around that, that mechanism going forward with a view potentially to opening future windows. If the. CEP sort of. identifies the need for it. So, you know, we've we've we've we've moved forward in breaking down that barrier.
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11:11
Baroness Sheehan
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Baroness Sheehan
Our final determinations. A quick question from. myself on the cap and floor scheme. I see that no hydrogen storage or thermal storage. projects were in the mix announced. Can you say whether they didn't apply or whether the mechanism. I think it's going back to Earl Russell's questions. It's a mechanism not. suitable .
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11:13
Lord Rooker
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Lord Rooker
Imports delivered. 15% of power, according to our notes, more are expected by 2032. I understand there's a five under construction. One of them is 600 miles. We're not talking about just. cross-channel links here. We're talking about some very long interconnectors. So where do you see the role for security of.
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11:14
Lord Rooker
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Lord Rooker
Other countries had the same weather as us and therefore couldn't send any electricity to us, or. someone started to dig up the cables. Or in Norway's case, they run out of water and therefore they're a bit worried about sending electricity out because they need the hydro. What's the issue about the interconnectors?
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11:16
Earl Russell
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Earl Russell
They give us security of supply. But you're quite right to ask the question, well, what what if we have a weather situation across the whole of northern. Europe where, you know, we're all we're all got lots of renewable. generation and we're all sort of suffering shortages. Can we depend on our neighbours for that, that that to back us up. And that's why that's why through the capacity market modelling, you know, we ensure that we you know, we have domestic.
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11:18
Earl Russell
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Earl Russell
And any, any kilometers. all potential sources of, of, of power have some degree of vulnerability, whether it's reliability, whether, as you say, it's some sort of physical security issue. And as part of the modelling, it is it is incumbent on. ensuring that we've got that. diversity such that if we lose one source through, be it an interconnector or a large power.
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11:18
Lord Rooker
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Lord Rooker
Then we've got adequate capacity to pick up the the gap. Yeah, that's my final point. As I say, I'm just concerned we're an island nation. It's not the same across the rest of Europe. By and large. I'm assuming everything's land based. Looking after it is probably a lot easier than being several hundred meters down in the water, surrounded by all the other cables we've got. So our.
security in quotes is a bit different to the other countries in Europe. And I just want to .
security in quotes is a bit different to the other countries in Europe. And I just want to .
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11:21
Earl Russell
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Earl Russell
Much from from overseas. This, this being at a peak in a peak demand scenario, I guess. I, I guess it depends on the level of renewable output. So it's a, in a world where there is no renewable. output and we have peak demand. What your question is, are we dependent on imports from Europe? And I think there is some. dependency on that. Yes. Not absolute dependency. As I say, the the. contribution in the modelling is, is derated. But it's it's about having a diverse range of. supplies and trying to cover all potential weather scenarios. You can't cover absolutely everything.
You can't gold plate the system. But, but you know, we .
You can't gold plate the system. But, but you know, we .
11:22
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11:22
Earl Russell
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Earl Russell
Produce a problem, obviously, because it kept running the. There are going to be constraints. There are particular constraints on the transmission network particularly. Well. They're while they're maintaining their assets, whether they're building new assets. And that that does create constraints on how much we can import or indeed. export at any given time. So .
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11:23
Baroness McIntosh of Pickering
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Baroness McIntosh of Pickering
Interconnectors coming online from Holland, Belgium and other sources, and Baroness Coffey raised the very valid point about London came that close to. electricity going down. Is it something that perhaps necessary and the. The regulator would look at. favourably if these were to connect directly into brownfield sites in London to shore up the supply more. immediately in London itself, rather than being vulnerable to even more. vagaries of onward. transmission from a different part of the UK. So if there are these brownfield sites which. Which Baroness Coffey has. identified very close to the Thames, that this. This would seem very.
logical an area to pursue their new interconnectors.
logical an area to pursue their new interconnectors.
11:24
11:24
Earl Russell
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Earl Russell
Would. resolve a current problem going forward. So yeah. interconnectors are brought forward by private developers. And , you know, it would it would it would make sense if you could land those on, on the banks of. The embankment. But I think brownfield sites. But but but brownfield sites for further down the .
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11:24
Earl Russell
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Earl Russell
Sort of things are technically possible. Thank you. Earl Russell, thank you very much. Sorry. The last question for me. So I'd like to ask you generally about what other regulatory. barriers to deploying storage and low carbon dispatchable power. remain and what. actions are Ofgem is planning to address them. So obviously there's issues around different business models. There's planning.
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11:25
Earl Russell
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Earl Russell
And low carbon dispatchable power. If there's anything, nothing particularly comes to mind. You know, the main challenges at the moment are grid. infrastructure and getting the connection to the grid. So what we are doing as a. regulator is so we regulate the network companies, including the transmission companies. So, you know, our role is to and we to, to ensure that those companies are building infrastructure at pace that we provide the funding. So we're not a. regulatory blocker, if you like to building of. connections and network infrastructure. So, you know, that's an important role that we are playing at the moment to sort of facilitate this.
But, you know, we are not involved in the procurement of generation. We are storage through LDCs. We are through our cap and floor mechanism with .
But, you know, we are not involved in the procurement of generation. We are storage through LDCs. We are through our cap and floor mechanism with .
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11:26
Earl Russell
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Earl Russell
Low carbon dispatchable plan. That's more with government rather than ourselves. Are there any particular issues around the storage side that you're working on? The the I think we will learn from the first elders. window in terms of, you know, what, how that helped or, or what barriers or. deficiencies that that that initial regime had. You know, we're looking to learn for future windows . And on the grid side, would you be able to say just a word more about that, about future plans and regulations? So, so I guess on the back of the which the strategic spatial energy plan, there will be a.
strategic network plan, the central.
strategic network plan, the central.
11:27
11:27
Earl Russell
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Earl Russell
Plan, the, the SNP that acronyms. Yeah, I'm tripping over them all but that that that what will be incumbent on Ofgem is making sure that. investment needs from the networks that come through that plan again are are enabled at pace by as a regulator. So what we're really keen to do is, is remove any. bottlenecks and ensure the companies can get get on with these. projects and access to finance they need in order to build these.
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