The RIIO2 challenge group has called for an “urgent review” of the mandatory mains replacement programme for gas distribution networks to “ensure consumers pay only for what is necessary”.
The panel of industry experts and consumer representatives, which was assembled by Ofgem to give feedback on network operator’s business plans, said there was a “strong case” for revisiting the programme following a significant reduction in explosions since it was last reviewed by the Health and Safety Executive (HSE) around a decade ago.
Its report on the business plans submitted to the regulator in December said: “We have suggested Ofgem considers an urgent review of this programme with the HSE, taking account of recent failure rate evidence.
“Such a review should consider factors including the implications for the network of heat decarbonisation, projections for gas demand and consumer support for methane leakage reduction.”
The Iron Mains Risk Reduction Programme requires gas distribution networks to replace aging iron mains that are at risk of leaking with modern plastic pipes if they are located within 30 metres of an occupied building.
Changes to the programme could have significant implications for the proposed conversion of gas networks to run on hydrogen rather than natural gas.
Steel and iron mains are unsuitable for transporting for hydrogen due to a phenomenon known as embrittlement, whereby hydrogen molecules are absorbed into the pipes, making them weaker and prone to leakages. Plastic pipes do not suffer from the same problem.
The case for conversion partly rests on the ability to reuse these plastic pipes that would otherwise be left stranded within years of being installed. This, it is argued, would be cheaper than reinforcing the power grid to allow for the full electrification of heating. A reduction in pipe replacements would lessen the claimed saving.
In a statement responding to the report, the Energy Networks Association said the programme is “integral” to its recently published roadmap for the decarbonisation of gas networks.
Of the almost £10.7 billion gas distribution networks have proposed to spend over RIIO2, nearly half – or £4.7 billion – is allocated to the replacement of old assets.
The challenge group also said network operators cannot justify the £4.1 billion increase in non-load-related expenditure they have collectively requested.