The future of energy: regulatory models for the energy system shift

Over the past 30 years since privatisation, energy regulation within the UK has focused on maintaining an existing set of networks, with the objective of reducing costs and improving performance and customer service.

With the net-zero target clearly outlined and expected to be achieved by 2050, the challenge ahead of the regulator is much different - significantly expanding/repurposing the systems to decarbonise effectively and on time, whilst delivering value for money and fairness for all customers.

In this publication, we’ve outlined five potential models for the future of regulation including: 

• Progressive Evolution (closest to Ofgem’s RIIO2 framework) 
• Government decisions 
• Devolution revolution 
• Data decides 
• Maximum decentralisation

This is a pivotal time for the energy industry, and whilst there is no universally perfect model, change is needed now to ensure net zero targets can be met.