Supplementary written evidence submitted by Ofgem

 

I am writing to provide information in response to the outstanding questions from the committee. If I can provide any further information or support during the course of the inquiry please ask.

 

The Cabinet Office is the overall departmental lead for the resilience of CNI. What engagement have you had with the Cabinet Office on the forthcoming Resilience Strategy?

 

Ofgem has recently engaged directly with the Cabinet Office on the Resilience Strategy and we are in regular contact with BEIS on network resilience issues, particularly in light of recent storms. 

 

We expect the National Resilience Strategy to be published this year and remain open to working with Government to contribute to the development of sectoral policy and standards, and we will of course take any new policies into account in our regulation. 

 

Where appropriate we will work with devolved governments on the development of their programmes of work, including the third National Adaptation Programme in England. The UK Government is committed to developing a third National Adaptation Programme (NAP3) for England, due for publication in mid-2023, which will set out how we will meet the challenges set out in the third Climate Change Risk Assessment.

 

Does your lead department host a forum for operators and/or regulators to discuss climate resilience specifically? Numerous witnesses have suggested that the Government should play a stronger role in addressing interdependencies between CNI sectors. What specifically do you think the Government should be doing differently?

 

The Energy Emergencies Executive (E3) has been established with representation from BEIS, Ofgem and National Grid to consider the risks to the supply of gas and electricity to consumers and identifying ways to manage these risks.

 

Detailed emergency planning activities are undertaken by the joint industry and

government emergency planning body, the Energy Emergencies Executive Committee (E3C) and associated Task Groups, reporting to E3. This body, and its Task Groups, consists of experts drawn from the gas and electricity industries as well as government, agencies, regulators, Trade Associations and Industry Bodies.

 

Following an Ofgem recommendation, Distribution Network Operators established a climate resilience working group in 2021 to ensure there is an appropriate forum through which best practice and expertise can be established and shared across the industry. Since its establishment, DNOs have used this group to develop and align their climate resilience strategies which outline how they will contribute to cross-sector work in this area. Where appropriate and feasible, we believe this working group could be extended or replicated for other sectors.

 

We recognise that sectors will need to work closely together to identify and address their interdependencies. To enable this, the Government needs to ensure that all CNI sectors are sufficiently incentivised to deliver their findings within a certain timeframe. A clear methodology that CNI companies can collectively work through, also needs to be established to ensure consistency between sectors. 

 

What is your understanding of the CNI Knowledge Base currently under development by the Government?

 

We are aware of the existence of the CNI Knowledge Base but have not had any involvement in its creation and do not currently have access.

 

We are in discussion with BEIS and the NCSC to gain access to the knowledge base, but we do appreciate there are a number of challenges to be resolved given the sensitivity of the data and the approvals needed for data which has been collected on a voluntary basis.

 

To what extent, if at all, does the Government engage or consult you on the development of the National Security Risk Assessment? Do you have sight of the NSRA? If not, do you find the National Risk Register a useful tool?

 

We are aware of the NSRA but Ofgem is not formally part of this process beyond our regular discussions with BEIS. We're aware that the NSRAs are often drafted with tight timeframes and so it's not always possible to consult directly with Ofgem.

 

It is worth noting however that BEIS consulted with Ofgem on the Risk Preparedness Plan for GB regarding electricity crises which was updated following Brexit.

 

Ofgem does not have an organisation-wide approach to using the National Risk Register. However, Ofgem provides significant funding for physical security at critical gas and electricity sites identified by Government (BEIS and CPNI) as part of what's known as the PSUP or Physical Security Upgrade Programme. We have also funded significant programmes for improving cyber resilience and resilience to flooding.

 

Dr Charlotte Ramsay

Director, Energy Systems Management and Security

 

21 March 2022