Electricity Network Innovation Strategy

Transcription

1 Electricity Network Innovation Strategy Delivery Plan 31 August 2017 Document Ref: 02-NIS-17 Restriction: None

2 Document Control Version Control Version Issue Date Author Comments 1 31 August 2017 ENA and Group Submitted T +44 (0) W E info@energynetworks.org

3 Table of Contents 1 Introduction Plan Approach Requirements Timeline Stakeholder engagement... 6 Appendix 1: Other Initiatives... 7 List of Tables Table 1 Electricity Networks Licence Holders... 1 Table 2 Licence Condition Requirements... 2 Table 3 Plan for Development of the Electricity Network Innovation Strategy... 5 Table 4 Key Dependencies and Stakeholders... 6 Table 5 Key Initiatives for Consideration... 7 T +44 (0) W E info@energynetworks.org

4 1 Introduction (ENA) is the voice of the networks, representing the wires and pipes transmission and distribution network operators for gas and electricity in the UK and Ireland (known as Member Companies). On 30 June 2017, Ofgem issued a Direction notice to modify the standard conditions of the electricity transmission and distribution licences. These modifications require the affected licensees to consult with stakeholders and work together to develop and publish an Electricity Network Innovation Strategy by 31 March ENA will be coordinating the development of the Electricity Network Innovation Strategy and associated plan. This document outlines the plan for developing the initial strategy and is submitted by the ENA on behalf of the Network Licence holders listed in Table 1 in accordance with clauses 48A.4 and B16.4 of the Licence Conditions. Note that Table 1 includes the electricity transmission and distribution networks who will be referred to throughout this document as the Electricity Networks. The delivery of an Electricity Network Innovation Strategy is a critical part of the ENA s innovation work programme, as it makes the ongoing collaborative work within the ENA and its Members more visible. The Electricity Network Innovation Strategy will ensure that all of the relevant network licensees work together in relation to innovation, which will result in coordinated action on priority areas such as reducing cost to the customer, making our service more reliable and supporting the low carbon economy. As per section B16.3 and 48A.3 of Licence Conditions, the electricity distribution and transmission networks of Great Britain have agreed to make all reasonable endeavours to cooperate in the development and maintenance of the Electricity Network Innovation Strategy. This includes a twoyearly review and potential update where necessary, as per sections B16.5 and 48A.5 of the relevant licence conditions. Company Distribution Transmission Electricity North West Limited National Grid (TO and SO) Northern Powergrid Scottish and Southern Electricity Networks SP Energy Networks UK Power Networks Western Power Distribution Table 1 Electricity Networks Licence Holders The modifications to the Distribution Standard Licence Conditions (Condition 48A) and the Transmission Standard Licence Conditions (Condition B16) describe the same Electricity Network Innovation Strategy. Therefore, a holistic approach has been taken to ensure that the plan and Electricity Network Innovation Strategy developed is coherent and compliant with both the Distribution and Transmission Standard Licence Conditions. The ENA and its Members also believe that this approach results in more efficent processes/projects, lower costs for customers, improved safety, simpler policy and avoids bad practice. An equivalent licence modification has been issued for the gas networks, and the ENA will also be coordinating the delivery of this work on their behalf. While the plans and innovation strategies for the gas and electricity networks will be submitted separately, the ENA will ensure that a whole energy system approach is taken throughout development of the strategies. It is also critical that the Electricity Network Innovation Strategy is not produced in isolation. The strategy will need to align with other strategic ENA initiatives, for example the Open Networks Project, as well as other industry initiatives including the Future Power Systems Architecture (FPSA) project, the combined Ofgem/BEIS Smart Systems and Flexibility Plan and ultimately the development of the RIIO2 framework. T +44 (0) W E info@energynetworks.org 1

5 2 Plan 2.1 Approach The ENA is to coordinate the delivery of the Electricity Network Innovation Strategy and plan on behalf of its Member Companies. This work will be managed within the ENA Working Group, who will be responsible for representing their respective Member Companies (and therefore the Electricity Networks). An experienced consultant has also been contracted to assist in the coordination and development of the strategy, as well as help test Electricity Network thinking against other geographies and the wider industry. The procurement of the consultant involved a rigorous competitive process, with the candidates judged against specific criteria identified in this plan. Together the ENA, the Electricity Networks and the consultant will engage with relevant stakeholders, Ofgem and BEIS to produce a high quality, forward thinking and collaborative innovation strategy for the Electricity Networks. 2.2 Requirements The requirements for the Electricity Network Innovation Strategy are detailed in Clauses 48A and B16 of the Distribution and Transmission Standard Licence Conditions respectively. In particular, Clauses and of the licence conditions describe explicitly what must be included within the Electricity Network Innovation Strategy in a series of points labelled (a) to (f). These sections will subsequently be referred to as defined in Table 2. Clause / (a) (b) (c) (d) (e) (f) Description The Electricity Network Innovation Strategy must include: a description of the challenges and uncertainties which the Relevant Network Licensees consider are pertinent to the electricity network over different time periods that could be addressed through innovative projects; a description of the innovative projects and plans the Relevant Network Licensees intend to make in order to address the challenges referred to in paragraph (a) of this condition, with particular regard to how future Innovation Projects which Relevant Network Licensees will seek to initiate over the period of the strategy will help to address those challenges; a description of the challenges which the Relevant Network Licensees consider are pertinent to the electricity network over different time periods which are not currently being addressed through industry projects or plans, including but not limited to projects or plans made by the Relevant Network Licensees and Interested Parties; Table 2 Licence Condition Requirements a description of the innovative projects and plans the Relevant Network Licensees intend to make in relation to the challenges identified in paragraph (c) of this condition, with particular regard to how future Innovation Projects which Relevant Network Licensees will seek to initiate over the period of the strategy will help to address those challenges. Consideration should be given to the suitability of the Relevant Network Licensees to carry out the innovative projects and plans. If the Relevant Network Licensees do not intend to carry out innovative projects and plans relating to a challenge identified in paragraph (c), a reason should be provided as part of this description; a description of how Relevant Network Licensees will coordinate their activities on Innovation Projects to minimise unnecessary duplication of effort; and a description of how Relevant Network Licensees will share the learning that they have gained through Innovation Projects. T +44 (0) W E info@energynetworks.org 2

6 2.3 Timeline The plan for developing this strategy is described in Table 3, which details the various tasks, any related clauses from the licence conditions, predicted start and finish dates for the respective tasks and finally the responsible parties. The interim milestones shown in the timeline are subject to change to ensure efficient and accurate delivery in line with the final publication date of the 31 March The development of this plan is thus as per sections B16.4 and 48A.4 of the relevant licence conditions. Task Relevant Clause 1. Kick-Off Managers 2. Develop Plan 48A.4 3. Procure 4. Initial response to (a) 5. Initial response to (c) 6. Review and refine response to (a) and (c) 7. Stakeholder Consultation #1 B16.4 B A.8 Responsible Description Start Date End Date Managers Managers Duration (weeks) Kick-Off Meeting for Electricity Network Innovation Strategy 19-May May-17 0 ENA and Electricity Networks to work together to complete and agree plan of action for developing the Electricity Network Innovation Strategy ENA and have agreed to procure a consultant to assist in the development of the Innovation Strategy, as well as help test Electricity Network thinking against other geographies and the wider industry. Electricity Networks to describe the challenges and uncertainties, which are to be addressed by industry projects or programmes in the short, medium and long term. Electricity Networks to describe the challenges not currently being addressed by industry projects or programmes in the short, medium and long term. These are to be identified via a gap analysis against those described in (a) and prioritised based on relevance and importance with respect to the energy trilemma and other critical drivers. The consultant will review the Electricity Networks responses to (a) and (c) against their previous experience with stakeholders and other relevant regions, including Europe and North America. The consultant will run a consultation on (a) and (c) using the Electricity Networks' diverse and varied stakeholder lists, as well as any other relevant parties identified. The consultation will take the form of a call for written responses via correspondence, and will be initiated by the consultant. This stakeholder consultation will include the ENA Gas Members, to ensure the Electricity and Gas Network Innovation Strategies are aligned as much as possible. 19-May Aug Jun Aug Jun Aug Jun Aug Aug Sep Sep Sep-17 2 T +44 (0) W E info@energynetworks.org 3

7 Task 8. Incorporate Stakeholder Feedback 9. Initial response to (b) 10. Initial response to (d) Relevant Clause Responsible Description Start Date End Date The consultant will consider the feedback from Stakeholder Consultation #1 with the and incorporate any necessary changes. / (input) / (input) The consultant will work with Electricity Networks to formulate and develop programmes or projects to address the challenges in (a) on a short, medium and long term basis. This will likely involve a range of workshops and teleconferences between the consultant and the Electricity Networks (inc. ). The consultant and Electricity Networks are to take a similar approach to that described for (b). Duration (weeks) 2-Oct-17 6-Oct Sep Oct Oct Oct Initial response to (e) Managers / ENA and the Electricity Networks will document the various existing processes in place to promote coordination of activity on innovation projects, as well as minimise duplication of effort. These will be reviewed by the and the consultant, and potential additional opportunities for improvement will be identified, along with implementation plans. 31-Jul Oct Initial response to (f) Managers / ENA and the Electricity Networks will document the various existing methods and processes in which learning from innovation projects is shared. These will be reviewed by the and the consultant, and potential additional opportunities for improvement will be identified. 31-Jul Oct Produce draft strategy The consultant and the Electricity Networks will put together a first draft of the Electricity Network Innovation Strategy report, which will include the initial responses to sections (a) to (f). During this process a sense check will be taken to ensure that the responses and proposed projects and programmes of work are complimentary. In addition the consultant will assess alignment with the individual Networks Innovation Strategies. 23-Oct Nov Internal Members Review Electricity Networks to review the first draft of the strategy to assess alignment with individual Networks Innovation Strategies. Any major changes to be incorporated accordingly. 06-Nov Nov-17 2 T +44 (0) W E info@energynetworks.org 4

8 Task 15. Stakeholder Consultation #2 16. ENA LCNI Conference 17. Review and Incorporate Feedback from Stakeholder Consultation 18. Finalise Report & Internal Reviews 19. Publish Strategy Relevant Clause B A.8 48A.8 B A.6 (a) B16.6 (a) 48A.6 (c) B16.6 (c) Responsible Description Start Date End Date Managers / Managers Table 3 Plan for Development of the Electricity Network Innovation Strategy The consultant will run a public consultation based on the content in the draft strategy. The format of the consultation will likely comprise of an open call for comment (posted on ENA and Electricity Network websites), as well as stakeholder workshop days held in London and Glasgow. The workshop events are to be held before the LCNI conference, with responses to the open call closing in the week following the conference. This stakeholder consultation will also include the ENA Gas Members, to ensure the Innovation Strategies are aligned as much as possible. Dissemination of the first draft of the Gas and Electricity Network Innovation Strategies to the attendees at ENA's LCNI Conference in Telford. ENA and the consultant will run additional stakeholder engagement initiatives at the conference to increase the profile of the strategy and encourage responses to the open call. The consultant will consolidate the responses from Stakeholder Consultation #2 and consider these with Electricity Networks, before incorporating feedback into the strategy. A summary of these considerations will be documented for inclusion in the overall strategy alongside those from Stakeholder Consultation #1. The consultant is to work with the Electricity Networks to update and finalise the strategy. This will include a final set of workshops and teleconferences between the consultant and the Electricity Networks. The final report will also set out the procedures for updating the Innovation Strategy, as described in Part B, section 48A.6 B16.6. This time includes one month at the end of the period to allow ENA branding and alignment with the Gas Network innovation Strategy, which is also being led by ENA. ENA to publish Electricity Network Innovation Strategy on ENA website and distribute to the Energy Networks to clearly publish on their individual websites. Duration (weeks) 20-Nov Dec Dec Dec Dec Jan Jan Mar Mar Mar-18 0 T +44 (0) W E info@energynetworks.org 5

9 2.4 Stakeholder engagement The importance of stakeholder consultation for the Electricity Network Innovation Strategy was highlighted not only by Part C B16.8 and 48A.8 of the Licence Conditions, but also by the Electricity Networks and the ENA. In order to identify and address all of the challenges and uncertainty, it is essential that a wider viewpoint of the industry is taken. With input from our stakeholders, the Electricity Network Innovation Strategy will be better informed and more successful in addressing the challenges and uncertainties. Therefore, the decision was made to include two stakeholder consultations in the plan; one on sections (a) and (c) and the other on the overall strategy. The first consultation will be an online consultation that aims to engage stakeholders during the early stages of the project, so that all major challenges and uncertainties are captured before evaluating solutions in (b) and (d). The second consultation will ensure that all interested parties have an adequate opportunity to review the draft strategy and provide valuable feedback. This consultation will consist of face-to face stakeholder workshops in London and Glasgow, as well as an online consultation and the ENA s LCNI conference. The stakeholder workshops and LCNI conference will be used to disseminate the main aspects of the Electricity Network Innovation Strategy and also encourage feedback. Table 4 below shows a sample of the type of stakeholders that will be engaged as a part of this plan. Type Electricity Networks External Stakeholders Ofgem/BEIS Gas Members Other Initiatives Table 4 Key Dependencies and Stakeholders Description The Electricity Networks of Great Britain, including all DNOs, TOs and the SO have agreed to work together to develop the Electricity Network Innovation Strategy. Their internal innovation strategies will be key inputs to the joint strategy. External Stakeholders, for example the energy industry, academia, consumer groups and the private sector, will be invited to contribute to the Electricity Network Innovation Strategy by providing their views in response to the stakeholder consultations described in the plan. Ofgem and BEIS will provide key inputs to the strategy, and will be consulted with throughout the development of the strategy. ENA's Gas Members will be consulted (both directly and through the ENA Gas Team) throughout the development of the strategy, to ensure that cross-vector thinking is applied and that the Electricity Network Innovation Strategy is completed with consideration of the whole energy system. There are various other industry and Electricity Networks initiatives that will influence the direction that the Electricity Network innovation projects take. These will be considered in due course throughout the process. See Appendix 1. T +44 (0) W E info@energynetworks.org 6

10 Appendix 1: Other Initiatives The following table represents a non-comprehensive list of other ENA, ENA Members and wider industry initiatives that will need to be considered throughout the course of the strategy development. Due to the changes happening in the Electricity Networks, this list is subject to change and expansion. Reference Gas Network Innovation Strategy Open Networks Project Future Power Systems Architecture (FPSA) Project BEIS/Ofgem Smart Systems and Flexibility Plan (2017) RIIO 2 development Other energy vectors Individual Electricity Network Innovation Strategies Electricity Networks DSO Strategies Table 5 Key Initiatives for Consideration Comments Undertaken by ENA in collaboration with ENA Gas Members The ENA Open Networks Project will be a key input to the strategy, as it will help steer the direction of the future of the Electricity Networks in the UK. This will in turn influence the direction of some of the innovation projects going forward. See here for more information: See here for more information: reportdocs See here for more information: nergy_system_-_smart_systems_and_flexibility_plan.pdf This will be progressed within the ENA Regulation Team Including transport, heat, gas, etc. See individual Member Company websites See individual Electricity Network websites T +44 (0) W E info@energynetworks.org 7