To ask the Secretary of State for Business, Energy and Industrial Strategy, what steps his Department with Ofgem to attract investment in (a) innovation and (b) development of the electricity network as part of the Government's 2050 net zero commitment.
Monopoly energy network companies, which transport energy to homes and businesses, are regulated by the independent energy regulator, Ofgem, to ensure that they adequately maintain a safe and secure network whilst investing for the future and ensuring a fair price for consumers. In order to do this, Ofgem uses price controls to determine the revenues network companies may recover, the investment they may make and the performance standards they must deliver.
The regulatory price control is by law a matter for Ofgem who ensure, through the regulatory framework, that energy networks are able to deliver our net zero target, and Government will continue to engage with Ofgem on this. Ofgem has also established a Net Zero Advisory Group, with members from across government and the public sector, to advise on how price controls can best enable decarbonisation, including by bringing forward appropriate investment.
Since the start of the current electricity distribution price control (RIIO-ED1) in 2015, around £270m of innovation funding has been allocated to Electricity Distribution Network Operators, which is already supporting the move to net zero. Ofgem has also announced the introduction of a new Strategic Innovation Fund for the upcoming energy network price controls (RIIO-2). This fund, alongside funding to individual companies, will provide £450m for research and development into crucial green energy projects, with the potential to fund more if required.