IGov is exploring the link between innovation and energy governance, where governance is taken to be policies, institutions, rules and incentives. We are interested not only in these policies, institutions and rules and incentives – but how they develop – the politics behind their creation and implementation. IGov is putting together a framework for energy governance suitable for the 21st Century. This includes arguments for the restructuring, or creation, of institutions and the altering of rules and incentives within the GB energy system – and we are provisionally calling this Output Based Regulation. Our latest addition to this framework was our recommendations for Code Governance reform (see page 44 for figure), which includes our argument to get rid of self-regulation of codes. The energy world is changing rapidly and it is clear that current GB energy governance is no longer fit for purpose. We argue (as shown in Figure 1) that the roles and relationships between the GB energy institutions need to change – hence the need for: an energy policy committee (EPC); an integrated and independent system operator (IISO) which is the body tasked with transformation and ensuring security and which combines complementary market and network functions; that Ofgem be restructured so that it becomes an economic regulator, and that it is on the same level of hierarchy as the IISO. We think the IISO and the Economic Regulator should be overseen by the EPC which both advises the Secretary of State but also executes the Secretary of State’s decisions, thereby bringing in more legitimacy to decision-making.
IGov 8th Jan 2016 read more »