‘Lack of clarity’ on proposed role for Regional System Planners

There is a “lack of clarity” over the role and remit of the Regional System Planners (RSPs) proposed by Ofgem as part of its consultation on the future of local energy system institutions.

The UK Energy Research Centre (UKERC) said it is “unclear” whether the bodies would optimise the existing planning processes of electricity and gas distribution networks or carry out their own independent analysis.

In the case of the latter, energy networks would have a “much reduced” planning role as investment decisions would be informed by regional energy plans, according to the research body.

The consultation released in March states that RSPs would develop cross-vector regional energy plans using inputs from other sources including electricity and gas distribution networks and local authorities. UKERC said this has “the potential to create duplication” as energy networks already develop business plans based on customer and stakeholder needs and modelling of future energy scenarios”.

Despite their “ambiguity,” which allows for multiple possible interpretations, UKERC welcomed Ofgem’s high-level proposals, saying there is an absence of “an independent, whole-system view of regional needs and priorities.” It said RSPs should fulfil this role, providing “independent and national standardised approaches to regional planning”.

UKERC said there is currently “a great deal of variation in local approaches to energy planning” between different local authorities, and in particular, between England, Wales and Scotland: “Given this current ‘patchwork’ approach to sub-national planning, a key objective of the RSP should be to create consistency and standardisation in the development of regional planning assumptions.”

It said this work should be underpinned by “robust, participatory processes with local and regional actors, particularly those with a democratic mandate such as local and combined authorities and devolved governments. However, careful consideration needs to be given to how to build on existing data sources and engagement processes to avoid duplication whilst maintaining independence.”

UKERC said there is also questions over the most appropriate regional boundaries, which are “unlikely to be coterminous with existing network areas”.

Ofgem said the RSP role should be performed by a single independent entity with multiple branches, identifying the soon-to-be Future System Operator (FSO) as the lead candidate.

UKERC agreed with this suggestion in principle but said there are “considerable uncertainties” over the ability of the FSO to undertake this role.

The research centre said it is not clear how the FSO would ensure that RSPs have consistent approach across Great Britain while also understanding their regions: “How would the FSO develop the necessary understanding of localities and regions? What local and regional sources of knowledge and expertise would be represented in RSP governance processes and structures?”

UKERC additionally supported Ofgem’s proposals for a single, neutral facilitator of flexibility markets: “The focus on market rules, product standardisation, and oversight is appropriate and we support the emphasis on independent market platforms continuing to play a central role in tenders and customer interactions. The market facilitation role should also incorporate assessment of interactions between local and national markets.”

In its response to the consultation, industry trade body Energy UK recently warned that the “creeping scope” of the FSO could overload the body and lead it to lose focus on its “core functions”.

The FSO will take over all of the main roles of the existing Electricity System Operator as well as some of the planning functions of the system operator for gas. It is due to be established as independent, publicly owned corporation next year.