Responding to Ofgem’s T2 transmission price control Draft Determination, ScottishPower CEO Keith Anderson said: “Today’s announcement is gravely at odds with the UK Government’s ambition to boost investment in green infrastructure to help drive the economic recovery and accelerate Net Zero. It’s a massive missed opportunity.
“Coming just one day after Rishi Sunak has taken welcome steps to kickstart the Green Recovery, Ofgem is now trying to slam on the brakes. It makes no sense whatsoever.
“This was Jonathan Brearley’s first big test as the new Ofgem Chief Executive and he’s flunked it. Instead of investing more in creating green jobs and skilled apprenticeships in every community, at a time when the UK needs them most, this is a short-sighted return to austerity politics. Nobody benefits from this half-baked plan. It’s bad for jobs, bad for apprenticeships, bad for training and bad for the UK supply chain.
“Net Zero can be an accelerator of the economic recovery, but only if private companies are given the right conditions for investment. Slamming the door in investors’ faces by offering one of the lowest rates of return of any developed country traps the UK in an economic cul-de-sac.
“These proposals to drive companies to the lowest cost denominator leave us with big questions about how Ofgem can match its framework against the clear drive and leadership that we are seeing from government, at both UK and Scottish levels, where there is rightly a focus on how best to attract investment in a powerful economic stimulus that delivers long-term benefits.
“According to the Committee on Climate Change, the UK needs to double clean energy generation in order to hit its Net Zero targets and Scotland will provide half of that green power. Our transmission system already supports 11,000MW and is the vital link that brings green energy into people’s homes which is why investment in our networks now will benefit us for decades to come.
“The danger here is that Ofgem’s view puts the UK at an unnecessary disadvantage. In the wake of the COVID-19 crisis, there is fierce international competition to secure capital for infrastructure projects to support Net Zero and many nations are now powering ahead with green investments in their energy networks.
“Our plans come at a low cost to the consumer and deliver huge benefits. Our customers agree, with 80% of those surveyed supporting our business plan as good value for money. At this critical juncture, we should be doing much, much more to unlock the economic and environmental benefits of investment in Net Zero networks. Our proposals would help do that, at an additional annual cost per customer of less than 50 pence. We’ll continue to press our case very hard for Ofgem to rethink its approach in the context of the green recovery.”