OFGEM: Global “Regulatory Accelerator” to speed up transition to clean energy

• Ofgem, International Energy Agency (IEA), International Renewable Energy Agency (IRENA) and World Bank launch global “Regulatory Energy Transition Accelerator”
• Energy regulators have key role to play in hitting global climate goals
• Initiative will help regulators from around the world accelerate the transition from fossil fuels to clean energy at the lowest cost

Ofgem has today launched a global initiative, together with the International Energy Agency (IEA), the International Renewable Energy Agency (IRENA) and the World Bank, to accelerate the energy transition to provide clean, secure, and affordable supplies to everyone.

The world quickly needs to find cleaner ways to generate electricity, heat and cool homes and power transport and industry to support global climate goals.

Energy regulators have a significant role to play in turning ambition into real-world action to do this.

The Regulatory Accelerator will enable them to collaborate to seize opportunities and solve problems to speed up the global energy transition at the lowest cost.

In particular it can help countries with less developed energy systems to leapfrog the carbon-intensive paths other countries have previously taken.

Jonathan Brearley, chief executive of Ofgem, said: “Climate change is a global problem – and we need global solutions to the challenges we share as we build clean, secure energy systems to deliver our Paris climate commitments.

“The Accelerator will help regulators to learn from each other’s experiences and develop new approaches for the systems of the future. We are keen to see as many regulators as possible join the accelerator, particularly those from developing countries.

“We must think entirely differently to power the global economy without fossil fuels. It’s clear that the future for all of us lies in flexible energy systems powered by clean electricity, paid for fairly. In the long term this will better shield consumers from commodity price shocks as well as protecting the planet we all share.”  

Around 15 countries, including regulators from every continent, have already committed to participating in the Accelerator. More are expected to follow after the COP26 climate summit in Glasgow. 

The UK government and the IEA have agreed to provide seed funding to set up and co-ordinate the Accelerator for the first year.

Common challenges regulators around the world must address include:

• Meeting rising electricity demand, for example as more transport is electrified, by planning and building new networks at the lowest cost
• Supporting a rapid increase in renewable power, including through greater system flexibility and interconnection of energy networks across borders

The Accelerator will ensure that relevant knowledge and expertise from the World Bank, the IEA and IRENA as well NGOs specialising in assisting regulators are brought into its work programme.

Francesco La Camera, Director-General of IRENA, said: “IRENA’s World Energy Transitions Outlook clearly sees electricity becoming the main energy carrier of the future, with renewables providing 90 per cent of total global power by 2050. This initiative will help overcome the challenges in power sector decarbonisation and electrification of end-use and will support energy regulators across the world in the management of an accelerated energy transition.”

Fatih Birol, Executive Director of the IEA, said: “The IEA is proud to be part of the Regulatory Energy Transition Accelerator and looks forward to bringing its long-standing experience and expertise to the table. Regulators around the world have a unique role in the development of the clean, affordable and secure energy systems of the future. Through collaboration and sharing best practices, this initiative can help step up the pace of change, which will be crucial to achieving global climate goals.”

Demetrios Papathanasiou, World Bank Global Director for Energy and Extractives, said: “The World Bank is committed to accelerating the clean energy transition and we’re proud to work towards this change together with Ofgem, the IEA and IRENA, through the Regulatory Accelerator. This global initiative will equip energy regulators with the knowledge and solutions they need to build clean, affordable, and reliable energy systems for consumers around the world, reduce greenhouse gas emissions, and support global climate goals."

Notes

1. The Accelerator will be governed by a steering committee made up of representatives from the delivery partners, and a selection of representative regulators, and chaired or co-chaired by regulators on a rotating basis. The IEA will also provide cross cutting, coordinating function and a secretariat to support the decision making in the steering committee.
2. Participating energy regulators include Ofgem (Great Britain), the Australian Energy Regulator (Australia), the Public Utilities Commission (California), the Energy Commission (California), the Utility Regulation and Competition Office (OfReg, Cayman Islands), the Electric Utility and Consumer Protection Regulatory Agency (EgyptERA, Egypt), the Energy Regulatory Commission (CRE, France), the Public Utilities Commission (Hawai’i), the Regulatory Authority for Energy, Networks and Environment (ARERA, Italy), the Energy and Petroleum Regulatory Authority (Kenya), Medreg the energy market regulator of Morocco, the Commerce Commission (New Zealand), the Electricity Authority (New Zealand), the Energy Regulatory Authority (NVE-RME, Norway), the Regulatory Agency for Investment in Energy and Mining, (Osinergmin, Peru), the National Utilities Regulatory Commission (Saint Lucia), Energy Market Authority (Singapore), Federal Energy Regulatory Commissioner Allison Clements (USA), the Utility Regulatory Authority (Vanuatu)
3. Existing regional regulator networks have been valuable for knowledge sharing. The Accelerator is designed to bring a sharper focus on the challenges and opportunities of decarbonised energy systems of the future.
4. The Accelerator will identify priority areas for knowledge sharing, co-development and capacity building to make the biggest impact. To develop the programme of work, it will engage globally across regulators, international organisations and NGOs. It looks forward to working with others who wish to align relevant programmes on the energy transition and invites all energy regulators who wish to participate to do so. It will also seek to align with wider programmes and activities that support regulatory cooperation and technical assistance.