NESO's consultation on the 'transitional RESP' provides a first look at what bespoke plans could look like for the energy system in Scotland, Wales and nine English regions. This major shift to a 'bottom-up' approach that centres grid investment around local and regional need will have impacts right across the country. Here Merlin Hyman reflects on some of the takeaways from this important development.
Energy infrastructure is key to the aspirations of local places; without the right grid you can't build new homes or power local growth. We are now generating electricity from the sun and wind across the country and using it to power our industry, charge our cars and heat our homes and buildings. But to enable this shift at the scale and speed required we need to invest in a bigger and smarter local grid.
Today's consultation from the National Energy System Operator (NESO) on bespoke Regional Energy Strategic Plans (RESPs) for Scotland, Wales and nine English regions is, therefore, an important moment. When the final plans are published in January, they will underpin the investment plans of distribution network operators (DNOs) from 2028 to 2033. RESP should provide Ofgem with the confidence to shift to allowing a more strategic approach to network investment.
In practice, RESPs build on a lot of innovation in recent years in how DNOs engage with local authorities and other stakeholders to plan and invest in the energy network. This is a process Regen has been deeply involved in, developing the Distribution Future Energy Scenarios process with National Grid and Scottish and Southern Energy Networks, which has become standard practice for all DNOs.
Today's consultation starts to set out regional context for energy system planning. In Regen's home territory in the south-west, for example, the consultation notes such details as the fact that "approximately 60 district and communal heat networks are either operational, under construction, or have received planning permission".
As yet, submissions from local authorities and other stakeholders are not included in the pathways, which makes it difficult to assess how successfully the plans are capturing and responding to local needs. Apparently, NESO have already received some 1,500 'Strategic Investment' project submissions covering the length and breadth of Great Britain. A key test for RESPs will be showing the golden thread between the specific housing development/growth zone/new generation a stakeholder has submitted and the final plans. Being told their project is 'in the numbers' is unlikely to go down well with stakeholders.
It will also be important that DNOs continue to develop their own understanding of how demands on their networks are evolving. In the end, they are responsible for running a safe and efficient network. While RESPs will provide an important framework, there are sectors such as commercial and industrial that are not yet fully included. And DNOs need to take RESP numbers and consider how they will play out at a much more granular level to fully consider the impacts on their network assets.
Looking ahead, once we have RESPs, the real test will be whether they change our approach to network investment. Currently investment is still largely in response to requests to connect to the network. To enable the speed and scale of transformation required to achieve local growth and decarbonisation aspirations we need to shift to a strategic 'ahead of need' approach. We might get a clue when Ofgem publishes its methodology for distribution network business plans in the autumn.
For anyone interested in understanding more about the consultation, we're holding a webinar on 15 October that will unpack the key proposals and provide insight that should help with your submission. You can register here.
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