Shaping the regulatory and operating structure

If we are to maintain energy security while moving to a low carbon economy, coordination between industry and government is essential. Regulatory frameworks, planning regimes, and our own operating structure, need to become more transparent as well as being redefined and realigned to resolve today’s challenges for tomorrow’s world effectively.

Customer service advances

Customer service advances

By delivering high standards of service and working in partnership with our customers we can build strong relationships with them and, at the same time, foster goodwill with other stakeholders including regulators and governments. In 2009, one of our actions to improve customer service and meet customer expectations more effectively involved setting up two new departments in the US. Customer energy solutions provides integrated energy solutions to enable our customers to manage their energy choices better. Customer service operations covers end-to-end customer processes to give our customers an improved experience of dealing with us.

Shaping the regulatory framework for the future

In the UK, as we work to ensure continued security of supply, the significant investment needed to connect new sources of energy combined with the requirement to extensively upgrade ageing infrastructure, brings with it the need for regulation to adapt. We are feeding in to Ofgem’s review of energy network regulation (RPI-X@20). This is analysing the current framework in order to determine how best to regulate energy network companies to enable them to meet the challenges and opportunities of delivering a sustainable, low carbon economy.

In the US, as our long-term rate plans expire, we are focusing on filing rate cases to: fully recover the cost of running our business; ensure recovery of future investment; and secure and earn acceptable returns. We are also seeking to introduce features such as timely recovery of non-controllable costs; tracking of capital investment to reduce the time lag between spending capital and receiving income; and decoupling – so that our revenue is not linked directly to our customers’ energy usage (allowing us to enhance our energy conservation programmes without impacting on our revenue).

Building trust through continued reliability

Building trust through continued reliability

Reliability is a priority for National Grid, not only to deliver all our current obligations, but also to ensure we continue to be recognised and trusted by governments and regulators. This means delivering a reliable service not just when the weather is making headlines – as it did in the UK and US over the winter of 2009/10 – but all the time. To achieve this, we have been investing in our infrastructure over recent years and are proud that our Transmission and Electricity Distribution & Generation businesses successfully met all of their regulatory reliability targets for the relevant regulatory period this year.

Common operating model

Common operating model

If we are to meet the demands of the future, including ensuring appropriate regulatory funding for our operations, we must have in place a suitable and efficient operating model. As we work to create value through our complementary businesses, we have been seeking to increasingly align our processes and operate to common principles, standards and policies. In Gas Distribution, through collaborative events involving people from across emergency, maintenance, repair and construction, we have developed a plan that will drive operational performance improvements through redesigning our processes and replacing our ageing computer technology. In Transmission, our common operating model project is developing a plan to prepare us for the challenges and opportunities between now and 2020.

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