UW news review: top 15 of 2015

2015 was an action-packed year for utilities, with company shake ups, break ups and capacity crunch points dominating the agenda. Here, in order of popularity, are Utility Week’s 15 most-read news stories for 2015:

1. National Grid issues supply crunch alert

Utility Week’s most read news story of 2015 was a late entry, published in November, after National Grid called on generators to bring forward capacity for the first time in three years. It was also the first time ever that National Grid called on firms to cut demand to help ease supply margins. And with a spate of coal plant closures expected early this year further crunch alerts are expected to follow.

2.RWE to follow Eon in business split

RWE surprised the market in early December by announcing plans for an Eon-style business split to form a new “innovative decentralised energy group” within a year. Industry analysts remain divided on whether the plans will be enough to ease the heavy financial burden of its state-sanctioned nuclear decommissioning as European market conditions remain a struggle for conventional generators.

3. National Grid to rely mostly on demand-side balancing by 2030

Utility Week was the first to report in June that the system operator is set to radically overhaul the way it balances the UK’s electricity system to rely mostly on demand-side measures by the end of the next decade rather than using generating assets. National Grid spends around £850 million each year to balance the system, most of which is paid out to generators to produce more power. But the Power Responsive campaign will see more paid out to firms able to show demand flexibility when needed.

4. RWE could sell Npower, says CFO

In November Npower’s parent company hinted that the German energy giant could sell off its UK supply arm after persistently poor performance following a billing system upgrade helped drive RWE losses into double-digits this year. Reuters reported that RWE will need to make a plan by March 2016 to fix the beleaguered unit if it hopes to avoid disposing of the unit altogether.

5. British Gas refers power networks to the CMA

In March this year Utility Week exclusively reported British Gas’s referral of Ofgem’s price control determinations for five of the six electricity networks to the Competition and Market Authority, saying the controls were too lenient. At the same time Northern Powergrid also called for a CMA referral, saying the control left it withouth the revneue it needed to achieve its investment plan. Ultimately the CMA seemed to side with Ofgem, calling for only minor adjustments to the original determinations.

6. Domestic competition for water likely by 2020, says Treasury

In November the Treasury shocked the water industry by announcing plans to open the domestic market to competition as early as 2020. The sector is already working towards opening the market to competition for non-domestic customers in 2017, and was not expecting domestic competition to follow so swiftly.

7. National Grid boss to step down

In June national media reports said National Grid chief executive Steve Holliday would step down from his role after almost a decade heading up the firm. The widely respected leader was initially tipped to be replaced by chief financial officer Andrew Bonfield with chief operating officer of National Grid’ regulated business, John Pettigrew, as another likely option. Ultimately Pettigrew won the top spot (see more at number 11).

8. Ofgem: strong case for ISO to replace National Grid

Ofgem chief executive Dermot Nolan raised eyebrows at the start of the year, telling MPs on the Energy and Climate Change select committee that the regulator is working with government to consider establishing an ISO and breaking up National Grid’s remit as transmission operator and asset holder. Although he added that there was no suggestion of improper behaviour on the part of National Grid, the move would “remove the appearance of any favouritism”, he said.

9. National Grid mulls £10bn GDN sell-off

In November reports emerged that National Grid was considering a £10 billion sell off of its gas distribution networks. The claims, which were later confirmed, came six months after reports suggested National Grid would seek to sell its gas metering business (see number 13), with suggestions that Canadian pension funds and Asian sovereign wealth funds have been identified as potentially interested parties.

10. National Grid names new chief executive

Just five months after reports first suggested Holliday would step down National Grid confirmed his planned March 2016 departure and named long-standing Grid employee Pettigrew as his replacement. Pettigrew will take the top spot after joining National Grid almost 25 years ago, and will face pressure to prove that he is ready for the high profile role.

11. Tesla sets UK expansion for early 2016

In August Utility Week exclusively revealed that innovation giant Tesla plans to make its much publicised Powerwall storage offering available to the UK market in early 2016. The Powerwall is available in 10kWh form, set up for backup applications or as a 7kWh unit, optimised for daily-use applications. Both can be connected with solar or grid and both can provide backup power.

12. National Grid set for metering sale

Before news of National Grid’s planned GDN asset sale reports surfaced in May that the transmission system operator had plans to sell its gas metering business. At the time reports suggested that the 17 million gas meter assets would be sold ahead of the roll out of smart meters which is scheduled to be completed by the end of the decade. National Grid’s GDN sale is understood not to include meters.

13. Two top jobs to go as Ofwat overhauls senior management

The evolution of Ofwat continued apace in 2015 with chief executive Cathryn Ross announcing in September plans to overhaul the regulator’s senior management team, creating four new roles and losing two roles, in preparation for PR19. Four new roles were created in the senior leadership team: senior director of strategy and planning; senior director, Water 2020; senior director finance and governance; and senior director Thames Tideway.

14. Massara pays the price for Npower woes

After mounting speculation Npower boss chief executive Paul Massara stepped down from the helm of the beleaguered big six supplier after a 60 per cent decline in the supplier’s domestic business profits for the first half of this year. Npower’s parent company, RWE, said it was“acting on the unexpectedly negative mid-year result for 2015” in announcing the departure of both Massara and chief financial officer Jens Madrian. RWE said both Massara and Madrian will leave Npower “on their own wishes and by mutual consent”.

15. Thames Tideway names companies to take £2.3 billion in contracts

In February Thames Tideway outlined the key contractors due to receive deals worth £2.3 billion for the construction of London’s super sewer project. Six months later Thames Tideway announced that the Bazalgette consortium clinched the licence to act as infrastructure service provider for the multi-billion pound Thames Tideway Tunnel project. Bazalgette is wholly responsible for delivering the Thames Tideway Tunnel scheme, which is due to completed by 2023.