Private companies should be put in charge of energy innovation projects rather than energy network operators, according to the head of the Energy Technologies Institute. The push to build smart grids for both electricity and gas is being stymied because the gas and electricity network operators “lack the scale to handle that sort of investment”, ETI chief executive Dave Clarke today told MPs.
Currently gas and power network operators lead publicly funded innovation projects – usually in partnership with commercial organisations – via competitions overseen by regulator Ofgem. However, the challenge of building a new, smarter energy system will require so much money that only large multinationals can fund it. Therefore they should lead the innovation projects, said Clarke.
He also effectively told the Energy and Climate Change Committee that the UK’s regulatory framework was no longer fit for purpose and mooted an overarching energy authority.
“At the moment, the system we have is more or less regulated through Ofgem. Does that encompass engineering, economics and consumer science? Not really. There are also issues about [the electrification of transport],” he said. “Clearly there is a need for better integration of regulators. Do we need some kind of ‘energy authority which looks across power, heat, transport and gas?”
Clarke was giving evidence to the committee alongside Dr Tim Rotheray, director, Association for Decentralised Energy and Chris Clarke, director, Asset Management and Health, Safety and Environment, Wales and West Utilities.
They warned that the decarbonisation of heat would likely be a far greater challenge than decarbonising the power sector and urged a level playing field for investment in technologies such as CHP and heat networks.
Watch the session here.