Ofgem consultation on changes intended to bring about greater coordination in the development of offshore energy networks

Pathways to 2030 aims to develop the regulatory framework to allow the optimum engineering solution to connect 40GW of offshore wind to the system by 2030. 

The IET will aim to answer the following questions:

Early Opportunities

Question 1: Are there any concepts we have not identified and which developers may wish to progress?

Question 2: Should anticipatory investment risk be shared with consumers? If it should, what level of risk is it appropriate for consumers to bear?

Question 3: For concepts that intended to provide a wider system benefit, e.g. by mitigating an onshore constraint, how should the need for investment be demonstrated by the developer?

Question 4: What options are available to developers in demonstrating a reasonable expectation they intend to connect to the system?

Question 5: To what extent do you agree with out proposals to remove barriers to the Early Opportunity concepts? Please explain your answer

Question 6: Do you believe a Significant Code Review is required to give effect to a potential decision to ‘share’ AI risk between consumers and developers?

Question 7: Do you agree with Ofgem’s proposed approach to deliver the objectives of Early Opportunities workstream?

Pathway to 2030

Question 8: We consider that a holistic design will result in a more coordinated, economic and efficient network. Do you agree? Please give reasons for your answer.

Question 9: Do you agree with the planned work for a detailed network design offshore? Who do you believe is best placed to undertake the detailed design for assets that are in offshore waters?

Question 10: Who do you believe is best placed to undertake the detailed design for assets that are in offshore waters?

Question 11: Do you agree that the existing developer led model should be retained and applied where the HND indicates a radial solution should be used? Please explain your answer.

Question 12: Please provide your views on each of the delivery options we have described in this document. In providing your views, please comment on the issues we have raised. Please also give your views on the implementation issues we have raised.

Question 13: Please describe any feasible delivery options that we have not set out in this document

Multi-purpose Interconnectors Workstream

Question 14: Do you think we are focusing on the right models at this stage, or are there other models we should be considering? Is it also necessary to consider the evolution of such MPIs from pre-existing assets? Ultimately, should Ofgem accommodate multiple MPI models (e.g. IC-led and OFTO-led) or just one? What factors influence your answer?

Question 15: Do you agree with this position with regard to ownership structures of MPIs under the current framework?

Question 16: What are the commercial, operational and regulatory factors that would drive a developers preference for either the OFTO-led or IC-led MPI model? and do you envisage a different usage of the component assets of an MPI depending on the MPI model?

Question 17: How would the line to shore (L1) be used in practice and what would you consider to be the primary and secondary activities from a practical perspective? Please provide views for both the IC-led and OFTO-led models, highlighting any differences between L1 usages across the two models.

Question 18: Are there any barriers within the current frameworks, such as definitions within the CUSC, SQSS or other industry codes, that might prevent the line to shore (L1) being classified as either an OFTO or an interconnector while undertaking other secondary activities?

Question 19: What are your views on the feasibility of adopting a regime that requires developers to submit evidence to support their licence application (for assets that form part of an MPI) and commit to regular performance reports? Would this be practicable, proportionate, and effective? Are there other options that work well for industry that we could explore further?

Question 20: What are your views on the practicality of transposing obligations from one licence into another, which obligations would be the most important to incorporate into a remaining licence?

Question 21: Do you think the exemption provision with the Act offers any solutions to licencing MPIs within the current framework, even if only a temporary solution until a potential enduring solution is implemented?

Question 22: Are there any aspects of the priority dispatch and curtailment arrangements, the TCA, or the cross-border trading arrangements that are adopted in UK that might influence the choice of MPI models?

BEIS Question 1: What do you consider to be the key challenges to the establishment and operation of MPIs in the UK presented by current and proposed regulatory requirements applicable in EU Member States or other countries which MPI projects may connect with, or by the TCA? (e.g. regarding the efficient operation of MPIs under both the Home Market and Offshore Bidding Zone approaches). Are there further domestic challenges to these possible market design options

The Institution of Engineering and Technology Trustees propose submitting a response to this consultation and invite comments from Members who have expertise in this area and have studied the consultation documents. In its capacity as a professional body, the IET will confine itself to only addressing those questions that are within its area(s) of competence.

For more information and a summary of the questions, please refer to the consultation webpage.

This consultation is closed comment.