National Grid says forcing system operator regime change would destabilise energy market


National-GridNational Grid has warned that rushing to reshape the backbone of the UK energy system would increase investor uncertainty.

Turkeys don’t vote for Christmas, noted Energy & Climate Change Committee member James Heappey, but nonetheless asked National Grid’s director of SO operation Phil Sheppard how Decc might proceed in exploring plans for an independent system operator (ISO).

Sheppard said the move might be possible in the long run, but not in the short- to mid-term.

“We are working with Decc and Ofgem to explore what Amber Rudd said in her reset speech was a greater separation of the SO [system operator],” said Sheppard. “There is some benefit in addressing… some of the perceived conflicts of interest. But in terms of timings for an ISO, we don’t think that is in the best interest of consumers at the moment.”

“Injecting that sort of uncertainty into the UK market at this point in time we would deem as counterproductive. If investors are looking for certainty around making investments, increasing that uncertainty, introducing an ISO and consequentially a potentially large raft of market changes to make that work effectively, it doesn’t seem the right timing.”

Grid was “not saying never,” said Sheppard, “but [that is] certainly not [appropriate] in the short or medium term.”

Watch the session here.

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