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19 November 2018
On 16 October 2018, the government Department for Business, Energy and Industrial Strategy ("BEIS") and Ofgem released a progress update (the "Update") in relation to their July 2017 joint paper Upgrading Our Energy System: Smart Systems and Flexibility Plan (the "Plan"). Having considered the Plan in a previous article, we examine here the key points arising from the Update.
Since July 2017, the Update states that BEIS and Ofgem have:
We draw out the more notable points from the Update below.
The Update discusses the steps that have been taken, and those that are yet to be taken, to improve certainty over the treatment of storage in the current regulatory regime with the aim of providing further clarity for developers of storage facilities:
The Update demonstrates a number of developments in relation to smart networks and the removal of barriers to demand side response:
The Update confirms that the following progress has been made towards improving market access for providers of flexible services such as storage and DSR and ensuring that they are rewarded for the value they provide to the electricity market:
The actions summarised above are positive steps, but there remain significant challenges for providers of flexible energy solutions, particularly around revenue stream certainty and the confidence in the future value of flexibility. Nevertheless, we are seeing continued interest from developers, investors and debt providers in the sector, who would all welcome greater certainty in relation to the regulatory landscape for flexibility.
For further information on this topic please contact Robert Lane, Munir Hassan, Sarah King or Louise Dalton at CMS Cameron McKenna Nabarro Olswang LLP by telephone (+44 20 7367 3000) or email (firstname.lastname@example.org, email@example.com, firstname.lastname@example.org or email@example.com). The CMS Cameron McKenna Nabarro Olswang LLP website can be accessed at cms.law.
This update has been reproduced in its original format from Lexology – www.Lexology.com.
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