MPs: Give DSR 15-year capacity market contracts; make DNOs commit to zero carbon


Demand-side response providers should be allowed to bid for 15-year Capacity Market agreements in line with generation and distribution network operators should commit to being ready to run local grids on zero carbon sources by 2025, say MPs.

Those calls from the Science and Technology Committee were among a raft of recommendations outlined in a new report urging serious policy action if the government intends honour laws passed to decarbonise the economy.

The Committee also wants to see:

  • the ban on sales of new combustion engine cars – and hybrids – brought forward to 2035; better incentives for consumers to buy low carbon vehicles and greater co-ordination of the EV charging rollout
  • a plan for the renewable heat incentive’s replacement in place by 2020
  • detailed plans for carbon capture and storage and a large scale hydrogen trial underway in the next few years
  • stamp duty tied to home energy efficiency and mortgage provides encouraged to consider energy efficiency within applications
  • policy support for large scale solar and onshore wind
  • support for storage
  • support for emerging technologies within the contracts for difference regime
  • revisions to Ofgem’s proposed charging regime changes so that clean generation technologies are not left worse off

‘Charge people for not having a smart meter’

Controversially, the committee also called for “Ofgem to be prepared to recover the costs of incomplete smart meter deployment from the suppliers of those consumers who do not have smart meters.”

Even though legislation makes clear that consumers do not have to have a smart meter, that effectively means charging consumers that do not have one.

Make DNOs commit to zero carbon grid

The report, while perhaps confusing coal free generation with zero carbon generation, called for distribution network operators to follow National Grid’s commitment to be able to run the power system – when possible – on zero carbon sources by 2025.

“We urge distribution network operators to adopt a similar ambition to National Grid System Operator, of operating a zero carbon grid by 2025,” it states.

“Ofgem should work with distribution network operators to ensure that the regulatory framework required to allow this is in place. If sufficient progress is not made we urge the Government to consider strengthening Ofgem’s mandate to require the distribution network operators to speed up the investment and upgrading of the distribution networks required. “

The implications for distributed thermal generation exporting to grid in that scenario – such as gas engines and combined heat and power – could be profound.

Capacity Market

As well as calling for DSR to be eligible to bid for 15-year Capacity Market agreements, the Committee recommended setting aside a minimum amount of funding set aside within the CM for low carbon technologies.

See the report here.

Related stories:

Capacity Market: Sara Bell on what happens next

Beis to consider 15-year contracts for DSR – if evidence to support it exists

Tempus wins Capacity Market court case

National Grid says it can go zero carbon by 2025

Delivering net zero: Unlocking the opportunity

Net zero: How to decarbonise heat?

Green hydrogen: How to get there?

Opinion: 10 policy steps to drive a low carbon heat market

Net Zero: Bristol’s £5bn decarbonisation plan

Emerging solutions: Can wind, rocks, coal mines and salt decarbonise heat?

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