Former electricity network commissioner Nick Winser has urged caution over introducing greater competition into the delivery of transmission infrastructure.
He was speaking at Utility Week Forum in London on Wednesday (17 January), where he expressed concerns about opening up the grid to greater competition in the context of the growing pressure to secure capacity in the constrained global supply chain for transmission equipment, like cables.
“It’s quite difficult to see if you make it (grid build out) very contestable, how you get the long-term relationships with the supply chain to lock in capacity 10 or 15 years ahead,” he said during the opening keynote address.
Winser was later quizzed on whether opening up the transmission network to competition posed a threat to wider strategic efforts to develop the grid.
The Energy Act, passed by Parliament last year, enables competitions to be run for the construction, ownership and operation of onshore electricity networks across Great Britain, ending the effective monopolies that currently exist in electricity distribution and transmission build outs.
Winser replied that the introduction of competition into the previously state-controlled energy sector had delivered a “lot of benefits” over the last 30 years.
He said “it is certainly true that competition through free markets can deliver substantial benefits for customers”.
Referring to the review of the transmission network which he carried out last year, Winser said: “I do think though we need to keep our eyes wide open to the consequences of it and that’s why the report is quite cautious about bringing new players in to build core transmission assets, integrated into the centre of the network.
“We need to engage long term with the supply chain and integrating these assets into a highly complex interconnected system is a professional technical task, which cannot be underestimated.
“Let’s not throw away the concept of competition but let’s be very, very cautious and think through where it can be used safely with the pressing timescales we’ve got and where it’s better to drive harder the parties that are already in place and encourage them more to deliver those assets.”
Responding to a question from Utility Week, the ex-National Grid boss also provided an outline of the “sister” report of last year’s Winser transmission review, which he is carrying out for the National Infrastructure Commission into electricity distribution.
He said: “It’s probably worth kicking the tires on how that’s going. There’s been a lot of good work done by the distribution companies and Ofgem but we know that if there’s a wholesale move to electric cars and heat pumps, we could be in the order of at least doubling or tripling the capacity needs in the distribution system over the next 30 or 40 years.
“That’s potentially very significant. Flexibility, and digitalisation will help that a lot but nevertheless, it’s a big build.”