Ofgem and the Energy Emergencies Executive Committee (E3C) have published the final reports from their complementary reviews of networks’ responses to Storm Arwen.
The reports contain dozens of actions to take forward, including the development of a new physical resilience standard, the stress testing of networks’ websites and call centres, and reforms to compensation arrangements.
Storm Arwen in November cut power supplies to more than a million customers after strong winds inflicted widespread damage to the electricity network, toppling overhead power lines across much of the UK.
Around 40,000 customers were left without power for more than three days and almost 4,000 were disconnected for more than a week as engineers battled to repair the damage in hazardous conditions.
Distribution network operators (DNOs) faced sharp criticism over their responses to the storm, with business and energy secretary Kwasi Kwarteng branding the long wait times to restore power to some homes as “unacceptable”. They were also chastised for poor communication after many customers struggled to get through to call centres or were given inaccurate reconnection estimates.
In light of these failings, Ofgem launched a six-month review into networks’ responses to the storm, whilst the Department for Business, Energy and Industrial Strategy (BEIS) commissioned a complementary review from the E3C. The final reports from these reviews have now been published.
Ofgem’s review, which focused on networks’ compliance with their statutory and obligations, found that in many cases customers were “badly let down” and left feeling “deserted and abandoned”.
Its report contains 20 recommended actions to improve their performance during future storms, split across five categories: network resilience, planning and preparation, handling of incidents, communication and support during the incident, and support after the incident.
Network resilience
Action 1: The majority of faults during the storm were caused by strong winds or trees and branches falling onto power lines. The E3C should review current network infrastructure standards and guidance, including those for vegetation management and overhead line designs, to identify potential improvements.
Action 2: There was some correlation between the poles that were damaged and their age. This needs to be investigated further, and working with DNOs, Ofgem will commission a review into how pole health is assessed to identify potential improvements to pole condition reporting.
Action 3: Some DNOs have worked with external expert bodies to assess the readiness and resilience of their organisations and other companies could benefit from doing the same. The E3C should assess the feasibility and benefits of developing a standard-based approach to organisational resilience.
Action 4: The current standards, incentives and guidance documents that support DNOs in providing a reliable network are more focussed on preventing interruptions from occurring, rather than the industry response during a power outage. The E3C should put forward proposals for an outcome-based resilience standard to set government and public expectations on restorations times during major disruptions.
Planning and preparation
Action 5: Although all companies initiated their emergency plans several days before the storm hit, they were not sufficient to deal with the scale of the damage inflicted. Northern Powergrid also failed to directly contact vulnerable customers on its Priority Services Register prior to the storm as should have happened under its planned winter preparedness campaign. DNOs should submit their winter preparedness plans for 2022/23 to Ofgem to provide assurance that they have taken the necessary steps to ensure all customers can be effectively supported during power cuts.
Handling of incidents
Action 6: The limited amount of remote monitoring on the lower voltage networks hindered DNOs from understanding the full scale and complexity of faults, impacting the deployment of resources to undertake repairs, restore power and support customers. The E3C should therefore review and update best practice for identifying faults and the extent of network damage.
Action 7: To help Northern Powergrid deal with a large volume of enquiries, UK Power Networks allowed some of them to be fielded by its call centres. This is a good example of DNOs working together to provide support to each other during emergencies. The E3C should identify other areas where mutual aid could be appropriate and effective.
Action 8: DNOs adopted slightly different approaches to the deployment of generators, which may have led to some customers being without for longer than necessary. The E3C should identify options to enhance the use of mobile generators.
Communication and support during the incident
Many customers struggled to contact their DNO over the phone and they also had difficulty accessing accurate information and reporting power outages and network damage. Northern Powergrid’s website was unavailable for a short period of time due to high volumes of traffic and Electricity North West switched off its call back function.
Action 9: The E3C should review and update “reasonable worst-case scenario” planning assumptions for call volumes.
Action 10: DNOs should stress test their telephony systems and websites to ensure they have sufficient capacity.
Action 11: Ofgem will work with DNOs to develop additional reporting metrics for communications channels such as websites, applications and social media.
Action 12: Ofgem will review the incentive framework for customer service in relation to call backs.
Action 13: More than a quarter (28%) of customers were given an estimated restoration time that was not within 24 hours of their actual restoration time. DNOs should improve their assumptions for estimating restoration times and their communications to customers.
It was not always clear what support was available to customers without power and what the respective roles and responsibilities were of DNOs and local partners.
Action 14: In consultation with local partners, DNOs should develop principles-based industry guidance on best practice in the provision of welfare support.
Action 15: DNOs should work with local partners to agree clear roles and responsibilities during extreme weather events.
Action 16: Where DNOs are providing discretionary support, they should make clear to customers what support is available and how they can access it. They should outline how this is being achieved in their winter preparedness reporting to Ofgem and BEIS.
Support after the incident
Action 17: DNOs should adopt lessons learned during recent storms to update their compensation processes and enable more timely and accurate payments to customers.
Action 18: DNOs should develop more robust processes for delivering compensation payments at scale.
Action 19: Ofgem will commission a review into the current compensation cap arrangements under the Guaranteed Standard of Performance (GSoP) and determine whether they need to be amended.
Action 20: Until this review is completed, DNOs should voluntarily lift the compensation cap for future storms.
Ofgem said most of these actions (1, 3, 4, 5, 7, 10 and 13 to 18) should be completed by 30 September 2022. Actions 2 and 19 should be completed by 31 July 2022, actions 8 and 9 should be completed by 31 August 2022 and action 6 should be completed by 1 April 2023. Changes to the RIIO ED2 price controls should be implemented for the release of its final determinations by 31 December 2022.
Additional redress
In recognition of their failings around restoration times and compensation, Ofgem said three companies – Northern Powergrid, Scottish and Southern Electricity Networks (SSEN) and Electricity North West – have agreed to pay almost £10.3 million into consumer resilience funds in addition to the more than £29.6 million of mandatory and voluntary compensation payments already made by DNOs to customers.
Ofgem said some of this additional redress will be provided as direct compensation to affected customers, whilst the rest will go to charities supporting the affected communities.
| DNO | Mandatory compensation | Voluntary compensation | Alternative action | Total |
| Electricity North West | £2,058,201 | £2,089,645 | £290,000 | £4,437,846 |
| Northern Powergrid | £9,790,000 | £2,600,000 | £7,690,000 | £20,080,000 |
| Western Power Distribution | £203,735 | £203,735 | ||
| UK Power Network | £8,225 | £8,225 | ||
| SP Energy Networks | £2,910,000 | £1,327,200 | £4,237,200 | |
| SSEN | £8,300,000 | £4,800,000 | £2,300,000 | £15,400,000 |
| Total | £23,270,161 | £10,816,845 | £10,280,000 | £44,367,006 |
The regulator said Northern Powergrid had accepted that the performance of its call centre had fallen below the standards it would expect to meet and added that this could be a potential breach of licence conditions.
Electricity North West and SSEN have also agreed to invest £3.7 million and £1.2 million respectively on network resilience using funding from shareholders.
Commenting on the report’s findings, Ofgem chief executive Jonathan Brearley said: “Distribution network companies faced challenging conditions in the aftermath of Storm Arwen, and I pay tribute to the many colleagues in those companies who supported customers and worked to get them back on power as quickly as possible.
“However, it was unacceptable that nearly 4,000 homes in parts of England and Scotland were off power for over a week, often without accurate information as to when power would be restored.
“Network companies need to do better, not just to prevent power disruptions, but to ensure that when power is off, they work smarter to get people back on power quicker, and keep customers informed with accurate and timely information. This is the very least customers should be able to expect.
“The frequency of extreme weather events is only set to increase so it is really important that industry, and those involved more widely, learn from Storm Arwen to better respond in future.”
E3C review
Many of Ofgem’s recommended actions were also among the 45 total actions listed in the E3C’s final report. Its additional recommendations included that:
- The E3C should review international approaches to resilience to identify best practice
- The E3C should work with the Met Office to identify and enhance research into severe weather risks and planning assumptions for the electricity sector
- Network operators should work with the government and Ofcom to secure the utility spectrum so the energy sector can develop its own resilient data networks in the future
- The E3C should review the approach to storm restoration, including if and how critical sites could be prioritised
- DNOs should share contact lists for emergency planners with resilience partners
- DNOs should ensure their telephony systems do not force-disconnect customers
- The Energy Networks Association (ENA) should lead on developing more publicity for compensation entitlement
Business and energy secretary Kwasi Kwarteng said: “Storm Arwen was one of the most extreme weather events in decades, and I’m grateful to all those engineers, armed forces personnel and volunteers who worked night and day to get people reconnected to power.
“However, it’s clear that thousands of customers were badly let down by electricity network companies, which is why I launched this review to identify and address any failings.
“This action plan will ensure better preparedness for future storms, boosting the security of our electricity system and protecting families.”
Network reaction
Responding to report, the ENA noted that, subject to Ofgem approval, DNOs intend to invest £14.5 billion in resilience measures over the five-year RIIO ED2 price controls beginning in April 2023 – an increase of around a fifth when compared to the £12 billion spent over the preceding five years.
ENA chief executive David Smith said: “Storm Arwen caused catastrophic damage and disruption to customers and we welcome today’s findings. It’s important customers have trust in their network operators and are supported during severe weather events.
“As well as implementing the recommendations set out by government and the regulator and enhancing customer service, network operators have also identified areas which will need increased investment to provide better energy security and service for customers in the long term. This is particularly important as severe weather events become more frequent.
“The six electricity distribution network operators have submitted these details in their business plans for the next five years and Ofgem is due to make its initial determination in the coming weeks.”
In a lengthy statement, Northern Powergrid chief executive Phil Jones said: “The extreme nature of the event meant we learned some difficult lessons. It highlighted some limitations in our systems and showed us things we can do to be able to provide a stronger response to more extreme storms. We are committed to doing those things to make the communities that we serve more resilient to extreme weather events.”
“We started to take action to improve our approach to customer communications and estimated restoration times during the later stages of the response to Storm Arwen, and we continued to work to improve that in the storms that followed. We have already seen some benefit from those early improvements that are helping to keep individuals, families, businesses and other key partners better updated and able to make more informed decisions in severe weather events. And we will keep working to improve – in line with the actions called for in the reports.”
He continued: “We are also investing in improving the resilience of our website, telephony systems and power cut map in periods of exceptional demand. Those investments are happening now and will provide greater support for our customers, increased call capacity and better messaging when we have large volumes of calls.”
“The biggest investment we make to limit the impact of storms on our region is in our network. By the end of the 2015-23 period, we will have made investments of almost £1 billion in maintaining the long term health of our network and increasing its resilience – and close to £200 million of that will have focused directly on our overhead lines. We are actively engaged in dialogue with our regulator about the right levels of investment for the coming years. We have proposed increased investment in our overhead lines of around 60%, along with over £50 million on tree cutting over the next five years.”
In addition to the £1.2 million of extra shareholder investment in network resilience outlined in Ofgem’s report, SSEN said it would provide a further £1.8 million of funding to local authorities for community and resilience projects and £0.5 million to Resilient Communities Fund over the summer.
SSEN director of operations Mark Rough said: “We have already taken steps to improve our response through listening to our customers and will continue to implement any and all learnings for future events. The additional £3.5 million in funding will support this aim, helping improve our operational response and support community members, particularly those most vulnerable, improve their own resilience.
“We will now work collaboratively with industry, community partners and policy makers to ensure the recommendations from today’s publications are appropriately reviewed, implemented and, where necessary, supported through the regulatory framework.”
Electricity North West said it had brought forward £5.2 million of investment in its network and restoration systems.
Customer director Stephanie Trubshaw said: “We know how difficult Storm Arwen was for so many people, and it provided challenges on a scale that we simply haven’t seen before which impacted both repair and restoration times. In some areas we had whole forests that fell on power lines, taking down up to 3km of overhead lines in places.”
She added: “The investment we’re making, which is already underway, will not only help improve restoration times, but also provide us more information about when and where equipment is damaged so that we can give more accurate updates to customers affected.”