Looking to the long-term: hearing the public interest voice in energy and water @SustainFirst #PublicInterest #longterm
Welcome and opening comments Ted Cantle, Chair, Sustainability First Sharon Darcy, Director, Sustainability First @SustainFirst #PublicInterest #longterm 2
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Thanks to our New-Pin sponsors
MeeCng the challenges of technology, climate change, customer expectaCons and socio-demographic change Emma Howard Boyd Chair, The Environment Agency @SustainFirst #PublicInterest #longterm 5
Market actors explain how they have taken long-term public interest outcomes into account in their businesses Panel chair: Ted Cantle Judith Ward, Sustainability First Chris Harris, Director of RegulaCon, npower Jim Cardwell, Head of Trading & InnnovaCon, Northern Powergrid Alex Plant, RegulaCon Director, Anglian Water @SustainFirst #PublicInterest #longterm 6
The long-term public interest in water & energy – what outcomes do we seek? Judith Ward Sustainability First @SustainFirst #PublicInterest #longterm 7
Developing New-Pin’s public interest voice • Defining the public interest The public interest is the aggregate well-being of the general public - both short and long-term . It comprises the combined interests of consumers, citizens, the environment and investors - for both today and tomorrow • Developing a public interest framework 8
What long-term public interest outcomes did New-Pin seek ? 9
Developing a common language was useful • Energy and water sectors – a focus on outcomes which are engineering- led / economic. • Public interest outcomes – viewed differently by different people. Shaped by many factors • Common language around public interest - helps build consensus around desired outcomes 10
Key quesCons to shape thinking for ‘long-termism’ • How to ‘frame’ the issue / draw the boundaries ? (dependencies, systemic risk) • Delivery time-scales – what consensus ? • Fairness : within & between generations ? 11
New-Pin looked at some ‘hard’ public interest topics • Long-run affordability – who pays for what - & when ? • Long-run resilience – meeting 21 st century expectations & challenges • Trust and confidence - developed a series of New-Pin frameworks – ‘Levers for change’ . 12
Levers for change – long-run affordability 13
Levers for change – long-run resilience 14
Levers for change – trust and confidence 15
Decision-makers – a pracCcal focus on long-term public interest outcomes • Know what outcomes stakeholders want • Manage conflicting interests transparently. Clarify why agree / disagree • In today’s decision-making - know how public interest outcomes and long-termism sit. And how delivered. 16
Market actors explain how they have taken long-term public interest outcomes into account in their businesses Chris Harris, Director of RegulaCon, npower Long-term affordability @SustainFirst #PublicInterest #longterm 17
Market actors explain how they have taken long-term public interest outcomes into account in their businesses Jim Cardwell, Head of Trading & InnnovaCon, Northern Powergrid Resilience and sustainability @SustainFirst #PublicInterest #longterm 18
Market actors explain how they have taken long-term public interest outcomes into account in their businesses Alex Plant, RegulaCon Director, Anglian Water Trust and confidence @SustainFirst #PublicInterest #longterm 19
Market actors explain how they have taken long-term public interest outcomes into account in their businesses Panel chair: Ted Cantle Judith Ward, Sustainability First Chris Harris, Director of RegulaCon, npower Jim Cardwell, Head of Trading & InnnovaCon, Northern Powergrid Alex Plant, RegulaCon Director, Anglian Water @SustainFirst #PublicInterest #longterm 20
Delivering public interest outcomes through markets, regulation and interventions Panel Chair: Maxine Frerk, Sustainability First Sharon Darcy, Sustainability First, Lawrence Slade, CEO, Energy UK Sonia Brown, Director, UK Regulatory Policy & Public Affairs, Visa Europe @SustainFirst #PublicInterest #longterm 21
Delivering public interest outcomes through markets, regulaCon and intervenCons Sharon Darcy, Sustainability First @SustainFirst #PublicInterest #longterm 22
Overview of tools for delivering long-term public interest Hard tools IncenBves and Market led compliance IntervenBons approaches SoZ tools Engagement Governance Behaviours and purpose 23
Delivering public interest outcomes in the face of change • Stay focused on public interest outcomes ??? • Enable flexibility ? ?? • Encourage innovation • Keep delivering the basics – boring things can be important • Use the most appropriate mix of tools for the job 24
Need a case by case approach to ge[ng right mix of tools Contestable approaches Efficiency InnovaBon, choice Flexible & dynamic Speedy decisions Non-contestable approaches Long-term vision Market frameworks and rules InformaBon Standards & compliance 25
Different outcomes need different mix of tools 26
Look at full range of market-led approaches 27
Specific issues for market-led approaches in energy & water Complex systems MonopolisCc EssenCal services characterisCcs InerCa Big price tags & long Complex decision asset lives making chains Networks Stewardship Different consumer Inter-dependencies segments, different ‘Anchors’ in the needs community Systemic risks
Ge[ng the ‘right’ regulatory rule book • The regulator is not ‘in the room’ when companies have to make decisions • Less prescription, more principles • Need to agree what ‘acceptable’ conduct looks like • Need to build understanding of basic ‘rules of the kitchen’ with big fines for getting these wrong 29
The role for government & regulators in terms of innovaCon • Removing barriers • Historical custom and practice? • Genuine protections for consumers, citizens and the environment? • Incentives and funding • Innovators need to make a profit! How to share risks and rewards • Align with desired public interest outcomes – innovation not end in itself • Look beyond technology to also include consumer facing, commercial and institutional innovation 30
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