Ofgem’s new chief has his work cut out

A hearty welcome to Dermot Nolan, who took up the reins of Ofgem this week. The mind boggles at the prospect of the new chief executive’s inbox, not to mention the sword of Damocles hanging above his desk as politicians of all colours threaten Ofgem’s demise. It will have been a frantic first week for Nolan – and here’s what might have been top of his list:

1.    A phone call to Ed Davey. The energy minister’s extraordinary intervention in the supposedly independent competition audit of the supply market last month leaves Ofgem with little choice but a referral to the Competition and Markets Authority when it reports back towards the end of this month. Nolan might also take a couple of minutes to flick through his regulator’s handbook – can it really be allowed for a secretary of state to single out a listed company for potential break-up, pre-empting the “independent” inquiry and wiping millions of pounds off its market cap in the process?
2.    A sit down with some of the bosses of distribution network operators. The networks are peeved that only Western Power Distribution was awarded enhanced status for ED-1, and mutterings are growing louder that Ofgem moved the goalposts halfway through the match by changing the weighting it gave to different metrics in the assessment of draft business plans.
3.    A call on the Treasury. George Osborne’s budget in two weeks’ time could have serious implications for energy markets, with a freeze on the carbon floor price expected, as well as possible further changes to Eco and the Green Deal. As we explore on p4, this could have unintended consequences for renewables subsidies further down the line.
4.    A crunch through the numbers with National Grid and the Department of Energy and Climate Change. The three have been unable to agree on capacity predictions, with Nolan’s predecessor Alistair Buchanan defying Decc to warn of a looming crunch in 2016. Nolan will want to make up his own mind.
5.    Dinner with Caroline Flint? Maybe not.