UK energy regulator weighs penalty exemption for National Grid venture
The Eastern Green Link 1 (EGL1) project, being built by Iberdrola's (IBE.MC), opens new tab Scottish Power Energy Networks and National Grid Electricity Transmission, consists of subsea and underground cables linking Scotland to north-east England.
Ofgem said the joint venture had requested a 480-day exemption from penalties related to project completion delays, due to global supply chain issues and capacity shortages.
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Reuters
20 minutes ago
- Reuters
RBA's new policy board comes with added unpredictability
SYDNEY, Aug 11 (Reuters) - Australia's central bank has a problem communicating that has injected an element of unpredictability into interest rate policy when global uncertainty is already high, and its proving costly for investors. It all stems from an April shake up at the Reserve Bank of Australia that shifted rate-setting power entirely to a new nine-member Monetary Policy Board. At just its second meeting in May, the board decided to cut cash rates by a quarter point to 3.85% and sounded more dovish than analysts expected, even briefly considering an easing of 50 basis points given the uncertainty caused by U.S. tariffs. This, combined with some soft economic data, led investors to wager heavily on another cut in July while a Reuters poll of 37 economists found 31 expected an easing. Crucially, investors were encouraged to pile into these positions because the RBA did not push back on expectations, as they had often done in the past. Imagine their surprise, then, when the MPB held rates steady in a rare spilt decision of six to three, leaving many investors with painful losses. Speaking to the media after the decision, RBA Governor Michele Bullock explained that the bank could no longer offer guidance because the rate decision was up to the board alone and it could not be pre-empted. Essentially, the RBA had changed the way it communicates to markets, without telling those markets it had changed. "Since no single MPB member can front-run the whole Board, future inter-meeting communication is unlikely to endorse or push back against market pricing," said Luci Ellis, chief economist at Westpac and a former assistant governor at the RBA. "This implies that markets will be surprised more often than in countries like the United States, where the central bank puts more weight on avoiding surprising the market." Since then, a benign inflation report now has investors equally convinced the MPB will cut rates to 3.60% at its next meeting on August 12, in part on the hope it would not want to shock twice in a row. Yet the MPB's unusual composition makes for added uncertainty as it has just two RBA officials, along with a top Treasury official and six part-time external members with backgrounds in economics, business and banking. The latter are appointed by the Treasurer of the day with input from the RBA. Markets have little to no idea what the views of these six are, and that is unlikely to change as there are only vague plans for each to make one public appearance a year. It is now quite possible RBA board members could find themselves out-voted on rates, yet the governor would still have to front the media to defend a decision they did not agree with. And, since the votes are unattributed, there might be times when it would be impossible for investors to know if the central bank had been overturned. "It's even easier for the governor to be voted down because they're clearly outnumbered by externals members," said Jonathan Kearns, chief economist at Challenger and a former top official at the RBA. "I think the board is probably feeling now more emboldened to disagree with the governor." "It does add a little bit more risk into things, but it's up to the RBA to provide good analysis and well formulated recommendations that are convincing to the external members." The new format marks the RBA as something of an outlier in global central banks. The Fed and European Central Bank have boards made up of only central bankers, while the Bank of England has five central bankers and four professional economists on its board of nine. Votes of individual board members are made public for the Fed and the BoE, which have both become more divided in recent months. Speaking to an economic forum recently, RBA Deputy Governor Andrew Hauser conceded the July decision was less predictable for markets than it should have been and said the board was still "feeling our way" on policy. He insisted this unpredictability would not be the new norm, but cautioned there would be "shocks from time to time." Investors betting on a rate cut are fervently hoping next week will not be one of those times.
The Guardian
2 hours ago
- The Guardian
Elon Musk's Tesla applies to supply electricity to households in Great Britain
Elon Musk's Tesla is gearing up to launch a household electricity supplier in Great Britain in the coming months. The US electric car manufacturer run by the world's richest man has formally applied to the energy regulator for Great Britain, Ofgem, for an electricity supply licence, according to a notice published on the watchdog's website. This would enable Tesla, which also runs an energy supply business in the US, to provide electricity to domestic and business premises in England, Scotland and Wales as soon as next year. It can take Ofgem up to nine months to assess an application. The business is expected to be branded Tesla Electric and could focus on supplying electricity to consumers who own Tesla products such as cars or batteries. However, it would not work for households on dual-fuel contracts because the company is only applying for an electricity licence. Tesla Energy Ventures, the company's Manchester-based energy subsidiary, made the application last month, and the move was first reported by the Sunday Telegraph. The application was signed by Andrew Payne, who has worked for Tesla since 2016 and runs the company's energy business in Europe, with responsibility for a team of 60-plus. The move comes at a time when Tesla's electric car sales across Europe have been falling. Sales of Teslas in the UK more than halved last month, according to data from the main industry body. Only 987 new Teslas were registered in the UK in July – down almost 60% on the 2,462 registered in July 2024. This means Tesla's UK market share shrank to 0.7% in July, from 1.67% a year ago. For 2025 to date, Tesla sales in the UK were 7% lower. This is a period during which Musk has faced heavy criticism for his relationship with Donald Trump, which has now soured, and his interference in politics in Germany, France and the UK. Tesla has sold many home storage batteries called Powerwalls that can be charged by solar power or from the grid at off-peak times to UK households. It also sells home chargers for electric cars. Sign up to Business Today Get set for the working day – we'll point you to all the business news and analysis you need every morning after newsletter promotion The company effectively revealed its aim to sell electricity to homes two years ago when it posted a job listing looking for a head of operations. It took its first step into the British energy market in 2020 when it was granted a licence to be an electricity generator. Tesla already has an electricity supplier in Texas, where it launched household supply deals in 2022. It allows Tesla owners to charge their cars cheaply and pays them for selling surplus solar power or electricity stored in its home batteries back to the grid.
The Guardian
8 hours ago
- The Guardian
Elon Musk's Tesla applies to supply electricity to households in Great Britain
Elon Musk's Tesla is gearing up to launch a household electricity supplier in Great Britain in the coming months. The US electric car manufacturer run by the world's richest man has formally applied to the energy regulator for Great Britain, Ofgem, for an electricity supply licence, according to a notice published on its website. This would enable Tesla, which also runs an energy supply business in the US, to provide electricity to domestic and business premises in England, Scotland and Wales as soon as next year. It can take Ofgem up to nine months to assess an application. The business is expected to be branded Tesla Electric and could focus on supplying electricity to consumers who own Tesla products such as cars or batteries. However, it would not work for households on dual fuel contracts because the company is only applying for an electricity licence. Tesla Energy Ventures, the company's Manchester-based energy subsidiary, made the application last month, and the move was first reported by the Sunday Telegraph. The application was signed by Andrew Payne, who has worked for Tesla since 2016 and runs the company's energy business in Europe, with responsibility for a team of 60-plus. The move comes at a time when Tesla's electric car sales across Europe have been falling. Sales of Teslas in the UK more than halved last month, according to data from the main industry body. Only 987 new Teslas were registered in the UK in July - down almost 60% on the 2,462 registered in July 2024. This means Tesla's UK market share shrank to 0.7% in July, from 1.67% a year ago. For 2025 to date, Tesla sales in the UK were 7% lower. This is a period during which Musk has faced heavy criticism for his relationship with Donald Trump, which has now soured, and his interference in politics in Germany, France and the UK. Tesla has sold many home storage batteries called Powerwalls that can be charged by solar power or from the grid at off-peak times to UK households. It also sells home chargers for electric cars. Sign up to Business Today Get set for the working day – we'll point you to all the business news and analysis you need every morning after newsletter promotion The company effectively revealed its aim to sell electricity to homes two years ago when it posted a job listing looking for a head of operations. It took its first step into the British energy market in 2020 when it was granted a licence to be an electricity generator. Tesla already has an electricity supplier in Texas, where it launched household supply deals in 2022. It allows Tesla owners to charge their cars cheaply and pays them for selling surplus solar power or electricity stored in its home batteries back to the grid.
