United Kingdom

February 2012 update

Progress on management of the cost of grid upgrades

Ofgem, the gas and electricity market regulator, has issued an “open letter consultation” on the way forward for the next electricity distribution price control review. The next electricity distribution price control (ED1) is due to start on 1st April 2015 but Ofgem is now seeking input from stakeholders on the key issues that should be covered by the review.

Ofgem recognises in the initial letter setting out their perspective on the scope of the review that uptake of low carbon technologies, such as solar PV, is likely to increase significantly during this next price control review period. A key component of this review will therefore be to ensure that DNOs accommodate these low carbon technologies in a timely and cost effective manner.

The document published indicates that distribution networks are not designed to accommodate large volumes of low carbon, decentralised generation and Ofgem expects their take up to be an important driver of investment needs during the review. However there is uncertainty over how fast and where uptake will be. One challenge will be to strike a balance between ensuring that network capacity is in place to accommodate low carbon technologies and ensuring that customers do not pay for redundant assets.

As part of the review, and in order to ensure the timely and cost effective connection of low carbon technologies, it is likely to be necessary to consider the following issues:

  • the approach the DNOs use in developing their business plans – particularly the timeframe, scenario analysis and methodology to evaluate different investment strategies5
  • the outputs Ofgem will require the DNOs to deliver, particularly relating to connections, network reliability and environmental objectives and whether it is appropriate to establish output targets for dates beyond the end of the review
  • barriers to the DNOs adopting commercial arrangements to manage demand and generation output (demand side response) and incentives and uncertainty mechanisms.

The connection of low carbon technologies is an overarching consideration. Ofgem plans to have an overarching “flexibility and capacity” working group to focus on this issue, which will start in advance. This working group will inform the development of the associated outputs and ensure coordination between them.

The review of G83/1

Ofgem, the gas and electricity market regulator, has included the issue of managing cost of grid upgrades to accommodate increased volumes of decentralised generation, including solar PV, as a central pillar of the document setting out the initial scope for the next electricity distribution price control review. Ofgem also plans to have an overarching “flexibility and capacity” working group to focus on accommodating increased decentralised generation.

The review of G83/1 began in May 2011 and a final version is expected to be published in March 2012. The key things this review was looking into were:

  • Clarification of 16A per phase (ie 3.68kW single phase & 11.04kW three phase)
  • Additional references (BSEN & IEC Standards) and Definitions (align with D Code & G59/2)
  • Clarification and renaming of 2-stage connection process to make it clearer and easier
  • Clarification on definition of “close geographical region”
  • Significantly simplified application, installation & commissioning and decommissioning forms

Local Authority Building Control

Local Authority Building Control (the membership body representing  local authority Building Control in England and Wales) has published a guidance note for its members on best practise for dealing with questions regarding the installation of solar PV panels on domestic properties. This note was written by Doug Basen and outlines that if the installer is a member of a competent persons scheme which requires Part A, C and P competency then the Local Authority should leave the installer to carry out the installation with no interference. If the installer is a member of a competent persons scheme which requires Part P competency only, the self-certification aspect of any work is restricted to electrical installation only and the remainder of the work is subject to formal consent under the building regulations, which must be applied for through the Local Authority building control department.