Local Electricity Network Coordination Group minutes: August 2023

Attendees and apologies

• Onshore Electricity Policy, Scottish Government

• Last Mile UK

• Local Energy Scotland

• Scottish Power Energy Networks (SPEN)

• Scottish Wholesale Association

• Warmworks

• Community Energy Scotland

• Network Rail

• Scottish Futures Trust

• Heat in Buildings, Scottish Government

• Scottish and Southern Energy Networks (SSEN)

• Homes for Scotland

• CPT Scotland

• Transport Scotland (TS)  

Items and actions

Transport Scotland and SSEN to engage on the Public EV Charging Strategy and Expansion Plans.

SG to compile a list of the “challenge areas” that have been discussed and circulate to the group for comment by correspondence ahead of the next meeting. The list will identify the short-, medium- and longer-term priorities and identify gaps in current evidence on immediate issues, uncertainty mechanisms and anticipatory investment.

TS to circulate a Bus Decarbonisation Taskforce ‘How to Guide’.

DNOs to issue invitations to members of this group for bilaterals to inform production of their D-FES.

SG to confirm next meeting date.

SG to circulate minutes.

Introduction and overview of meeting objectives 

The Chair gave an overview of the meeting agenda and welcomed new attendees.

The Terms of Reference (ToR) for the group were agreed.

The minutes from the meeting on 23 June 2023 were approved.

Interactive Session: Opportunity for industry attendees to provide evidence from individual case studies and discuss how they can support open data. 

The Chair opened the discussion and invited attendees to share case studies and evidence.

The DNOs noted that they could not discuss commercial level detail but welcomed a general discussion on broader concepts and issues.

Housing/Heat

It was noted that members of the LENCG have shared detailed case studies separately with DNOs.

Key, common concerns from the new build sector were highlighted including grid constraints, and the time taken for estimated loadings, and reinforcement works to upgrade existing infrastructure.

Gathering evidence to demonstrate issues is challenging due to the nature of the relationship between customers and DNOs, which means organisations do not have access to data at a post code level. This creates a lack of clarity about the scale of the problem.

Rural communities where the grid is older, presents more technical challenges and the propensity for these communities to be in or at risk of fuel poverty is significantly higher than in urban areas.

Stakeholders committed to sharing further data with DNOs but noted that the data is garnered from the way the process works now and does not reflect what will be required as demand increases.

DNOs are exploring how to speed up processes.

Further issues were raised regarding barriers to connection for community buildings.

Key concerns around delays, a lack of clarity of information and the need to get firm costings as early as possible were highlighted.

Transport

Feedback was provided on the decarbonisation of buses. Fitting charging infrastructure in the depot was identified as the main stress point.

Feedback was provided on the perspective of Charge Point Operators (CPOs), who have reported perceiving the process of dealing with the DNOs inconsistent, time consuming and complex. In particular, CPOs have also raised the challenges surrounding lease lengths for substation infrastructure and upfront cost of connections.

The challenge DNOs face regarding the requirement to move infrastructure to accommodate the electrification network was noted.

It was also noted that the time to instruct substation legals once designs are approved is generally taking three to four months. Further clarity was sought on the reasons for the delays and DNOs were asked if processes can be sped up.

The connection process does not allow for applicants to oversize connections to accommodate future planning and the potential for additional zero emission buses purchased if required.

Cost estimates provided by DNOs are only valid for a limited period. This can be problematic due to the length of the site development and planning process.

TS highlighted ChargeUK’s work to map the process around the installation of charge points to identify any blockages. It is hoped this work could be fed into the LENCG to build up the evidence base.

Further anecdotal evidence about the length of time it takes to get quotes for connections and the length of time for the connections themselves was provided.

TS is working closely with Scottish Futures Trust to try and more accurately forecast the uptake in EVs and the capacity required for charge points.

For higher voltage routes TS estimates that installations are at half the rate they need to be to hit 2030 targets. Existing connection issues are expected to become more acute with the expected scale of uptake.

It was highlighted that there is a need for the private sector to provide DNOs with further evidence regarding the current landscape and future demand for the electrification of depots and EV lorries for the transportation of heavy goods for the food and drink sector. TS noted the study that they have commissioned from Herriot-Watt to support the Zero Emission Truck Taskforce, which would be published in 2024 and is likely to provide helpful evidence in this regard.

General discussion

DNOs reported issues around skills and training. Funding for DNO staffing resources from the regulator is not the only factor. DNOs reported challenges around upskilling and retention of existing staff and not being able to recruit quickly enough.

It was noted that Ofgem sees anticipatory investment as a positive obligation on DNOs.

There is a need for industry stakeholders and members of the LENCG to continue to provide evidence for where the anticipatory investment will be required.

It was noted that it would be useful if DNOs could identify areas where there is current capacity, which could then be targeted.

DNOs said they are working to provide greater visibility of the market of capacity.

It was acknowledged that Ofgem has a difficult role in balancing the need for acceleration and anticipatory investment with protecting bill payers.

It was suggested that it is key for the LENCG to build on evidence to articulate problems and challenges today and work together to develop a plan to address these problems in the longer term.

The Nick Winser report was noted as a good reference point to build on.

DNOs are looking at current pain points and frictions.

DNOs are keen to make the case for more investment from Ofgem in the current price control but require solid baseline evidence to do so.

Key date highlighted: January 2025 re-opener window for load related investment.

The lack of grid capacity and delays in the connections process also highlighted as challenges for the iDNOs.

DNOs requested feedback on what members/sectors are doing to build in flexibility so that network need might be reduced.

TS referenced the Public EV Charging Strategy and Expansion Plans, which are in the process of being agreed.

It was suggested that a roadmap should be developed to reflect where we are now and where we need to get to for each of the sectors. This would help the DNOs to consider what is achievable in line with SG targets.

The Chair noted that the agenda item on Distribution – Future Energy Scenarios (D-FES) is a key part of developing a strategic plan for what demand and generation will look like.

Regarding a roadmap, the Chair noted that similar feedback has come through the Scottish Government’s Draft Energy Strategy and Just Transition Plan (ESJTP) consultation. SG is currently considering the responses to the consultation and working to develop a strategic roadmap that will identify the key projects and, milestones that will be required.

Ways of Working: Discussion on future ways of working effectively to make required changes, including engagement with the D-FES and with Ofgem’s work on local/regional governance

SG gave an overview of D-FES and said it was crucial that stakeholders and the LENCG group feed in information about future plans to aid the DNOs in the process.

It is important to remember that where costs are not picked up by the connecting customers, they all paid for by all consumers in that network area, which is why Ofgem, as the regulator, has a high level of scrutiny.

D-FES is a key part of demonstrating to the regulator, the ESO and UKG level of future demand and key milestones. This level of detail will be crucial for unlocking investment and giving the regulator a degree of confidence/certainty.

The DNOs confirmed that the D-FES follows a similar process/format to the Future Energy Scenarios (FES). It looks at the pipeline, engagement and includes technical interviews with industry bodies and local authorities and includes a data exchange.

SSEN noted that their process starts in September 2023 and requested a bilateral with members of the LENCG. SSEN confirmed that correspondence regarding this would be sent following this meeting.

It was suggested that at the next meeting the DNOs could provide a further update on the D-FES process and reflect on engagement with stakeholders.

It was noted that the discussion has touched on several areas that may not be familiar to all members of the group such as Ofgem’s Access and Forward- Looking Charges Significant Code Review (Access SCR). This means that from April 2023 reinforcement costs for demand connections (including heat pumps) will be socialised. Further information on Access SCR can be found on the Ofgem website here.

It was suggested that the ‘How to Guide’ that was produced for the Bus Decarbonisation Taskforce could be a useful resource for members of the group.