Networks must ‘overcome commercial challenge’ of innovation: SSE

SSE Power Distribution's head of asset management and innovation has urged the networks to "overcome the commercial challenge of innovation" and make sure it becomes business as usual.

Speaking at Utility Week’s Future Networks Conference in Birmingham, Stewart Reid said: “I think [with] a lot of this innovation it’s not the technical challenge that’s the big issue. It’s the term ‘business as usual’ and the commercial challenge.”

“The technical bit is the easy bit,” he said. “And I get a wee bit frustrated that we dwell too much on the technical bit.”

Energy Networks Association (ENA) head of engineering Kieran Coughlin agreed, saying when it comes to new developments such as demand side response “a lot of the technical challenges, whilst significant, are probably being addressed”. He said the bigger issue was creating markets and putting the right regulatory frameworks in place.

Energy storage was highlighted as a key area where regulation and business models aren’t keeping pace with new developments. “Battery prices have halved in six years,” said National Grid’s director of system operation Phil Sheppard.

“There clearly are some regulatory and commercial barriers to overcome,” he said. “There’s some legal clarification, where a lack of a proper definition for storage is causing uncertainty for investors.”

Director of the Association for Decentralised Energy (ADE) Tim Rotheray said district heating faces similar issues as well: “We think there is a future for a regulated market, which enables peoples to invest in district in the same way that people are able to see other infrastructure investments.”

“If you invest in networks now, you need to be able to look at the different network opportunities … by being able to compare different options”, he continued. “That probably means you need a regulated environment to de-risk investment.”