UK Regulators Network Cross-sector infrastructure: problem to - - PowerPoint PPT Presentation

UK Regulators Network Cross-sector infrastructure: problem to solution

January 2016

John Holmes, Head of Better Regulation and Policy Office of Rail and Road Presentation to NJUG’s Delivering the Vision Day

Structure of this presentation

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• Introduce the UK Regulators Network (UKRN): its objective

and projects

• Explain the problem with ‘cross-sector interactions’
• Why UKRN acted
• How we approached this issue
• What we found
• The solutions we’ve proposed
• And, what happens next

Who is UKRN?

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• The UK Regulators Network: members include regulators of

utility services, transport, financial, health and legal services

• Its objective: promote better regulation and collaboration between

regulators, for the benefit of consumers and the wider economy

What does UKRN do?

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• UKRN supports it members through:
• A forum to share and learn good regulatory practice
• Helping explain regulation to stakeholders
• Enabling independent regulators to act jointly or share

practices where this is in the interests of consumers

• But - UKRN itself is not a regulator: members choose

what and how to act in response to UKRN proposals

• Projects so far:
• Investment focused
• Consumer focused
• Common cross-sector issues

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• Significant investment – much of it

public money – will be spent on infrastructure

• Installing new infrastructure can

disturb existing in-situ assets of utility networks, which need protecting and agreements put in place

• A perception of inefficiency or

‘opportunism’: monopoly networks ‘in the way’ of new development in other sectors ‘Cross-sector interactions’ – the problem

Rail & air 27% Comms 5% Energy 53% Water 15% Infrastructure spend by regulated utility

Source: HMT and National Infrastructure Pipeline

£213 billion on utility infrastructure by 2021

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• UKRN – independent regulators of key utilities, concerned

with two issues:

• The impact on regulated networks when they interact

with other regulated sectors; and

• The impact on the economy, if the behaviour of

regulated utility networks raises costs for others

• But, what is the evidence and, if appropriate, what should

be done, by whom? Why UKRN acted

How we approached this issue: evidence and proportionality

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• Evidence – of any harm and its causes –

essential to support any action

• Broad consultation
• We built upon the call for evidence with

targeted information requests, meetings with stakeholders and desk research

• Many of the responses were confidential or

commercially sensitive

• Our aim: develop remedies that reduce the

costs of infrastructure development, whilst balancing consumers’ and network

• perators’ interests

June 2014 – industry forum Call for evidence June 2015 – remedy consultation September 2015 - conclusions

Service standards

No clear point

• f contact

No firm timescales Poor governance

Co-ordination and information

Inaccurate asset information Unco-ordinated access to site Little adoption

• f best practice

Design standards

Onerous Specifications Inconsistent treatment of similar projects

Costs

Onerous contract terms Poor cost transparency

What we found

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The problems in summary:

The solutions

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• Three measures:
• 5 Good practice principles – a

guide to networks and clients

• Access statements – the practical

information that clients’ need to make crossing assets easier: recommended publication by December 2015

• Annual reporting – a chance to

review how well clients’ needs are met, and make improvements

• All aimed at supporting a self-

regulatory solution

What next? Is the problem solved?

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• Greater cooperation across and between network sectors

and infrastructure developers is key to making these solutions a success: something industry, not regulators or government must deliver.

• UKRN proposals aim to facilitate greater clarity for clients

and promote – not prescribe – action by incumbents

• A follow-up review, by UKRN, planned for early 2017: does

the problem remain? Were the remedies sufficient?

Points of contact

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• Contact: john.holmes@orr.gsi.gov.uk
• UKRN’s website contains copies of all publications and

regularly updated news: www.ukrn.org.uk