In a separate development, OVO Energy and Flexitricity, along with a range of other flexibility providers and leading trade associations, have presented a letter to the Minister of State for Energy and Clean Growth Claire Perry, asking Government to ensure that network companies are incentivised to procure flexibility rather than carry out network upgrades.
The Flexibility First approach centres on six key principles:
1. Flexibility services procured first: Network companies should be obligated to tackle network constraints by procuring flexibility services as a first measure, rather than by building expensive new network infrastructure.
2. Targeting ‘whole-system’ outcomes : Rather than focussing on benefits to themselves, network companies should be incentivised to help us achieve our carbon reduction targets at the lowest possible costs for consumers.
3. Rewarding grid utilisation : Network companies should be rewarded for making better use of the existing network, rather than building new infrastructure.
4. Facilitating renewable energy adoption: The cost and availability of new connections for renewable generators should become important output categories for network companies, given their central role in supporting renewable energy adoption.
5. Promoting entrepreneurialism : Network companies should be able to make genuine financial gains and losses based on their performance on whole-system outcomes.
6. Continue to separate network operators from users: Ofgem has rightly established that network operators may not own and operate energy storage.
By implementing these changes, the group says that Ofgem and the Government can play a major role in helping the transition to a smart, flexible energy system that will not only enable deep decarbonisation, but also create new jobs and businesses and save energy bill payers money.
The Government's Road to Zero strategy announced the formation of an EV Energy Task Force, bringing together stakeholders from the energy, automotive and other engaged sectors with the aim of maximising the benefits and reducing the barriers to the EV transition. The LowCVP will be the convenor of the EV Energy Task Force.