Distribution networks make extra redress payments over Storm Arwen failings

Three network companies have agreed to make redress payments for their performance during Storm Arwen in addition to compensation payments already made. Publishing a review of networks’ response to the storm Ofgem said severe weather events are likely to become more common, as the effects of the climate change are felt, “so it is imperative that all DNOs are well prepared”. It said all networks have areas for improvement, and it will require coordination and collaboration amongst them to implement the recommendations effectively. It said that in future distribution network owners (DNOs) should submit elements of their winter preparedness plans to the regulator each year.
Over one million customers lost power as a result of network faults and damage during the storm. Around 40,000 customers were without supply for more than three days and nearly 4,000 customers were off supply for over a week.
Northern Powergrid will make the largest payment of £7.69 million, in addition to the £12.39 million compensation it has already paid out to consumers. Ofgem found that NPg did not directly contact vulnerable customers enrolled on its Priority Services Register (PSR) prior to the storm, which should have been done as part of its planned winter preparedness campaign. This was only discovered through Ofgem’s information requests. NPg’s call centre received a large volume of enquiries (at one point outweighing the capacity of the local telephone network, which caused over 4,000 calls to be terminated). NPg’s website was also unavailable for a period as it was unable to deal with the volume of traffic.
UKPN stepped in to provide assistance, which Ofgem said was a good example of DNOs working together. But across the networks many customers found it very difficult to get in contact with their DNO via phone and had difficultly accessing accurate information, as well being unable to report power outages and network damage.
Electricity North West has agreed a package of £0.29 million in is addition to £4.15 million it has already paid out. It too had some communications failings, including switching off its call back function. ENWL shareholders will fund £3.7 million of spending on network resilience.
SSEN has agreed a package of £2.30 million in addition to the £13.10 million it has already paid out to consumers, and its shareholders will fund £1.2 million of network resilience work.
Ofgem said that NPg and ENWL had far fewer resources deployed initially at the outset of the storm compared to other networks. They had fewer than 55 line workers and field engineers available on the first day of the storm whereas SPEN had 445 deployed across its two licence areas (SPD and SPMW). All DNOs increased their resource levels rapidly over the following days as the NEWSAC mutual support agreement meant less affected DNOs (UKPN & WPD) sent resources to other DNOs, while SPEN transferred staff from its transmission business to support staff in distribution. Staff were willing to travel long distances across the country to assist with rebuilding and repairing the network.
UKPN set up communications aid to NPg at short notice – it provided call centre facilities and established a new process whereby UKPN’s call handlers were able to handle some outbound calls on behalf of NPg. Ofgem said similar arrangements may be a good addition to NEWSAC, as could identifying how other parts of the energy industry, including electricity transmission and gas distribution operators, could support electricity distribution operators in major incidents, and vice versa.
Feedback from stakeholders and customers said that it was not always clear what support was available to help customers. So more clarity is needed on the split of roles and responsibilities between DNOs and local Resilience Forums as regards communications and welfare support.

Vegetation management
The majority of network faults during Storm Arwen were caused by high winds or trees being uprooted, falling onto overhead lines and snapping or pulling the poles down. Older poles were apparently most vulnerable.
Ofgem said the UK’s resilience group, E3C, should review current network infrastructure standards and guidance to see how network resilience to severe weather events could be improved. This should be completed by 30 September 2022.
This is not the first time the link has been made between vegetation management and resilience. In 2008 Ofgem agreed a so-called ‘reopener’ for networks’ price reviews because new quality of service standards required extensive survey and cutting of vegetation. Networks were allowed a one-off increase in their allowed revenues, the largest of which was 8% (in the case of the network around Yorkshire, which then was CE-YEDL and is now NPg). Those service standards focused on vegetation effects on network assets during normal service, rather than in more extreme storm conditions.
In response to the report, the Energy Networks Association (ENA) said DNOs plan to increase investment and expenditure in resilience measures over the next five years by around 20% to £14.5 billion, if their business plans are approved by Ofgem. That will go towards measures such as tree cutting, flood prevention and other energy security measures.

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