Should the National Grid be broken up?

17 June 2016
Should the National Grid be broken up?

MPs are want the government to break up the National Grid. They're asking for the company to be split, in favour of an independent system operator (ISO), like they have in America.

The report from the committee said: "The government should set out its intentions regarding an ISO as soon as possible, and consult on a detailed, staged plan for their implementation, so as to avoid injecting uncertainty into the energy sector."

This follows the warning from the Energy Institute, who said that continual changes in energy policy is pushing away investors.

What many people won't know (and obviously some will), is that the National Grid is a privately owned company, and they own the main electricity infrastructure in England and Wales.

This is where some people have a problem.

The report continues: "National Grid continues to dominate this market. We would like to see greater competition for new interconnector developments in the future, particularly given potential conflicts of interest relating to National Grid's interconnector holdings."

This relates to the fact that the National Grid has stakes in two interconnector power links with the continent, and want more, which means that there's an argument of a conflict of interest.

Angus MacNiel MP, the committee chair, said: "National Grid's technical expertise in operating the national energy system must be weighed against its potential conflicts of interest. The independent system operator model has worked in the USA. It is time for it to be brought to these shores."

National Grid said: "We take very seriously the need to provide confidence that any potential conflicts of interest are handled correctly and have a lot of experience operating in an environment where this is a key part of what we do."

"We are currently working with the government and with regulators to ensure we continue to manage potential conflicts as our role develops."

TOPICS:   Utilities

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