Ep. 74 Leading Change in Energy with Georgina Mills from OFGEM talking with Karen Anderson, Business Development Manager at WUN.

In this episode of the WUN podcast, WUN Programme Development Manager Karen Anderson is joined by Georgina Mills, Director of Energy Systems Management and Security at OFGEM. Georgina shares insights from her impressive career spanning the UK water and energy sectors, including her time at Ofwat and the New Zealand Commerce Commission.

Georgina shares insights on the complex challenges facing the energy sector—from affordability to the drive for net zero—and how OFGEM is responding through innovation, regulatory reform and leadership. Georgina highlights the potential of demand-side flexibility and the importance of removing barriers to progress.

The conversation also delves into diversity and inclusion, flexible working and how OFGEM is supporting its staff. Georgina reflects on her leadership style and the cultural shifts needed to lead through uncertainty in a rapidly changing industry.

This episode is a must-listen for anyone interested in the future of energy, leadership and inclusive growth.

Transcript

Speaker A: 0:03

Welcome to the Women's Utilities Network One for all podcast. Our corner of the world where we'll be talking all things energy, water, sharing personal stories and debating female issues. Enjoy.

Speaker B: 0:21

Hello and welcome to the ONE Podcast. Thank you for joining us today. I'm Karen Anderson and I'm the Programme Development Manager here at one. And I'm really excited to be bringing you another edition of our ONE podcast. I'm really pleased to be joined by Georgina Mills today. Georgina is the Director of Energy Systems Management and Security at ofgen. She has a wealth of industry experience in both energy and the water sectors, having previously been a director ofwat for 10 years, followed by time living and working in New Zealand at the Commerce Commission. Georgina, thank you so much for joining us today. It's really great to have you along. I just wonder if you could take a few minutes to tell us a little bit more about your career today and about your current role and your team at ofgem. Lovely.

Speaker A: 1:02

Thanks, Karen, and thank you for having me. It's a real privilege to be here today. So, as you mentioned, I've spent quite a bit of time working in both the water and energy sectors. But I started my career in the Government Economic Service after studying economics at university and at that point I was really interested in competition and regulatory economics. So I started off my career at the Office of Fair Trading and moved to the Department for Trade and Industry as was back then, and worked in an environmental economics team. I then moved on to the Department for Transport, which was my first role really in economic regulation. And I was working in a team that was reforming the framework for airport economic regulation. And that's when I realized how much I was interested in economic regulation. It felt really practical, it felt really tangible and I just loved the focus on protecting customers. So following that post I moved to Ofwat, where I spent 10 years as a director working in a variety of roles. I worked on the price control, but I also was involved in the early days of the business retail market in the water sector. I then spent 18 months living and working in New Zealand at the Commerce Commission, which was a really interesting experience. The Com Comm, as they call it, is a multi sector regulator and also a competition authority. I mean, New Zealand's a really small country, so they regulate in a very different way. It's a low cost way of regulation and coming from UK regulation, seeing New Zealand regulation, the teams are tiny and the remits are very broad. So it's very interesting and a very different perspective to being a regulator in the UK and then our after 18 months I moved back to the UK last summer and started my current role at Ofgem. So my current role Ofgem, it's quite a mouthful. Energy systems management and security. And there's quite a lot within that.

Speaker B: 2:50

Struggle with that one.

Speaker A: 2:53

I have got it wrong at times, but there's a lot in there and it's brilliant, it's fantastic. And I feel like I'm learning more and more every day and there's something that I realize I didn't know each day I get to learn but essentially I'm responsible for security of supply. That's within my remit. Network charging is in within my remit, an area where I'm still learning. It's incredibly complicated but also fascinating. And I'm also responsible. My teams are responsible for the day to day operation of both the gas and electricity markets, including system operation and wholesale market rules. And we're also regulating the newly established National Energy System Operator, the niso. So there's a lot in there. There's a lot in there.

Speaker B: 3:32

Yeah. It does sound like a very wide and varied role at the moment and it sounds like you've had some really wide and varied roles in your past as so just thinking about your current role, I wonder if you could tell us a little bit more about your role, particularly in relation to the challenges that the sector have faced over recent years thinking about market volatility and the push for net zero. How have you and your team responded to these challenges of change and complexity?

Speaker A: 3:58

Yeah, so, I mean, I wasn't at OFFGEM during the crisis. I know the whole organization worked incredibly hard during that time. And I think one lesson that the sector has learned as a result of that crisis is the need to reduce our reliance on international markets to better protect customers from those volatile energy prices and bills in the future. So the government has published its Clean Power 2030 Action Plan which envisages a smaller role for gas in the future, GB fuel mix. So I think there are a few different areas in which my team specifically are kind of contributing to that and thinking about sort of how we recover those system cost costs from customers in future. So from a security of supply perspective, we are working with the government and the system operators to think about how we ensure security of supply in a kind of in a, in a system which is much more reliable on renewables at the moment. I think we know from the government's Clean Power 2030 action plan we need some gas on the System still in 2030 to support security of supply. And we're working with the government to ensure we kind of, we, we can achieve that in a way that protects our customers and, and is cost effective. Another aspect that my team is really interested in, this is a project that I'm quite excited about is thinking about how the system costs evolve as we transition towards net zero. So we're seeing more and more renewables on the system and those renewables are essentially going to result in sort of fewer renew, sorry, fewer volumetric costs in the kind of the stack of costs we see within the system. And we're going to see higher fixed costs because we're going to need more network. So thinking about how our current cost allocation and recovery methodologies work and how those costs eventually wind up on the consumer bill, we are looking at that and thinking, goodness, okay, there's going to be more fixed costs and potentially a greater proportion of the bill is going to comprise standing charges, which we know from the clear feedback we've had from customers that they don't like standing charges. So we are just about to launch this summer a review of our cost allocation and recovery methodologies. It sounds very technical, but it's all about how we recover these costs from customers going forward in an efficient and fair way.

Speaker B: 6:19

Key term now, I guess, isn't it?

Speaker A: 6:20

Yes, yeah. And I think we want to look at options. At the moment we have this kind of two part tariff standing in a volumetric charge and we're talking to regulators overseas to look at kind of some of the options they're pursuing. And we're really keen to start this conversation with the industry on kind of how does it work currently, how do we take these kind of, these system costs, how do we recover those from different types of customers and how do they wind up on the customer bill and what options may we have in future for making changes to the way this works and what will those options do in terms of will they look fairer, will they be more efficient, will they better support net zero, will they better facilitate economic growth? So we're really keen to start that conversation with the sector, thinking about what options we have available and what those options mean and the trade offs. We see from the experience of international regulators that there's no perfect option. All options involve trade offs. So we want to start that conversation with the sector about what the options are and kind of how we should look at those and how we should make those trade offs.

Speaker B: 7:25

And that's really interesting that that balance, isn't it, between all the different dynamics you talk there around Sort of sustainability and net zero and that drive for Clean Power 2030 in order to achieve the sort of challenging targets that we've set going into the future, there's obviously a real need for innovation and new ideas.

Speaker A: 7:43

Yes.

Speaker B: 7:43

What innovations have you seen in the energy sector that really excite you the most in terms of that sustain sustainability and efficiency aspect?

Speaker A: 7:52

Yeah. And actually it's interesting drawing on kind of the differences between water and energy, because I think the demand side response we call it, I think consumer led flex in energy, how consumers respond and the kind of what we could gain from the way in which consumers respond I think is an innovation. I'm so interested to see where the sector goes on this. In the water sector it's all about using less water. So like it's about reducing consumers or industrial customers use. Use to kind of using what water more efficiently. Fixing leaky loos, fixing leaks, etc. It's about reducing the use in water. But energy is more complex because the system in energy is built to service peak demand. So it's not just about people using less, it's about when you use it. So we call that demand shifting. And so that is really interested compared like comparing water versus energy. It's kind of the potential is quite different. And I think something that blew my mind when I joined the energy sector is this concept of demand Turn Up. And I've thought what we want to like encourage people to use more energy. Why?

Speaker B: 8:59

Yeah, I've been getting encouraged by my supplier to use energy on a Sunday.

Speaker A: 9:03

Yeah.

Speaker B: 9:05

Gym this Sunday. Yeah. Like mind blowing, isn't it? Yeah. Use more.

Speaker A: 9:09

Yes. Yeah. Use less. Yes. And we are seeing on some days in the year we are seeing excess supply on the system. So demand turn up may be an efficient way of actually managing the system and balancing the grid. So demand Turn up potentially has a role to play as well. So I'm really interested to kind of see where the sector goes in in that space. I think that'll be very interesting. The government has set some quite ambitious targets in relation to consumer LED flex. So it will be interesting to see how exactly they are delivered and the role that consumers play. Because consumers can be really active participants in that or they could also be quite passive. And a lot of the kind of it's tech that drives the kind of response as opposed to consumer actually saying, I'm not going to cook my dinner at this point in the day, I'm going to change my behaviour. A lot of it can be done behind the meter through kind of tech that the Customer's almost not aware of.

Speaker B: 10:04

Yeah. And I guess that's something really new, especially in the residential base, isn't it, in terms of that engagement with consumers?

Speaker A: 10:11

Yes, that will be interesting. It'd be really interesting to see how that develops.

Speaker B: 10:16

And I guess for us, from where we come in, the women's utilities network, in order to be innovative and to support the growth required in the sector, in terms of number of people that we need working in this sector, we need to recruit and retain a diverse and inclusive workforce. So you've worked across both the water and the electricity sector and both in and out of the UK in your career. I wonder, in terms of diversity, how would you say that has changed during your career?

Speaker A: 10:44

I think we're on a journey. I think New Zealand and the UK are both on a journey. So in the past 20 years, I've definitely seen improvements. But I also sit in meetings sometimes and observe there is not a huge amount of diversity. And I'm just talking about gender, talking about sort of like class, ethnicity, perspective. So I do think it's a work in progress. I think in the civil service, working at regulators, I've always been surrounded by lots of very clever women. I think there has been quite a marked contrast in some of my roles. When you're dealing with industry or the private sector, and I've actually been in meetings where you've had the public sector on one side of the table, it's been all women, and you've had the private sector industry or the. Or the legal teams on the other side of the sector, they've all been men. And it's kind of interesting, that difference has been quite.

Speaker B: 11:34

Why do you think that might be, that difference in the representation? I don't know if it's still today, but in the past between the public and the private sector.

Speaker A: 11:42

So I personally, I think it's because. And I might be biased here, and I might have people tell me that actually I'm wrong, because the private sector offers these benefits as well. But in my experience, the public sector has always offered flexible working, good maternity packages and just that offer has been much more flexible. So that very much has influenced my decision to stay in the public sector. But obviously that is just my perspective, but I think that might be one of the reasons that you see that difference. And it is improving, it is getting better. I'm seeing more and more females and more and more diversity on sort of the other side of the table, if you like, in the private sector too. But I've always seen a lot of women in the public sector too. It's always felt sort of like there's more diversity from my, My, my perspective in the public sector than. Than outside. But I'm definitely seeing an improvement and, and others may tell me that actually that's just my perspective and there are other drivers for that as well.

Speaker B: 12:40

That's really interesting. And, and I guess the energy sector, like many other industries, has really struggled with gender diversity among. Amongst all, you know, amongst other other types of diversity. How do you think OFGEN is supporting better representation at all levels in both gender diversity? But, but diversity in general? I guess.

Speaker A: 12:59

I think OFGEM is really conscientious of this. I think from a woman's perspective, there's a women's network. We're seeing lots of female directors, for example, at ofgem and even above that kind of, we're seeing real advocates for diversity and sort of a very conscientious approach. Obviously, it's a work in progress. We need to improve. But I think in terms of the genders we are seeing within OFGEM and the same as offwat, actually, as well, we're seeing lots of women, including on the set, on the board, at director level. So I feel that is great. I think in terms of other aspects of diversity, we probably still need to improve and that's very conscientious, I think, kind of that we know we need to improve and we're taking actions to improve that. But again, it's a. It's a journey, It's a work in progress.

Speaker B: 13:48

Yeah. And I know when we first caught up, we talked a bit about OFGEM and their support for women returning after maternity leave. That was what you were really positive about.

Speaker A: 13:58

Yes, and that's, I think, based on my personal experience. I mean, I was promoted when I was on maternity leave, but it was quite a shock coming back to the office after a year off because I just, in hindsight naively thought that I would just pick up exactly where I left off because I was the same person, nothing had changed and I hadn't just had a whole year off work. And I was actually quite shocked at. Oh, my goodness. Kind of. I have a different set of responsibilities and boundaries that I need to respect. I have been away for a year, so that's something I'm very cognizant of. When there are people, people within our organization now that returning from maternity leave, just to make sure not everyone needs it, some people can just pick up where they take off, but I. Exactly, yeah. So I think providing that Extra support to people that are coming back from maternity leave. And within Ofgem we have PDLs, which are your kind of. We have a line manager and we have a personal development leadership kind of. So people that work at ofgem, they'll have their line manager, which is their project, but they'll also have a PDL who's kind of responsible a bit more for kind of of career development pastoral support as well. So I think that approach really helps support people kind of because you've got someone who's there dedicated to thinking about someone's well being, their career development and then you've got someone else who's there thinking about sort of them from much more of a work perspective and done delivery of work objectives. And I think, yeah, having those two people looking out for you I think does help to provide a bit more support, including because we're remote working a lot of the time now post Covid, and that is part of ofgem's offer that up to the SES required to be in the office one day a week. So we are seeing more remote working. And I think that need to check in on colleagues kind of is greater because you can't, you can't see them in the office anymore. You can't tell whether people are struggling. Before we had homeworking, before COVID there'd be more signs that you'd see because you'd be bumping into people at the T point where now I think with remote working, that kind of, that pastoral care is quite important. So I really like at OFGEM that we have one person who is the line manager, but we have another person for each of our people that is responsible, responsible a bit more for that pastoral care and that career development as well.

Speaker B: 16:08

And that takes some of the pressure off a line manager as well, doesn't it? Because, you know, we often hear how pressurized these sort of line managers are. Pressure from below, pressure from above and not much support in terms of that side of things. So I really like that idea. That's really interesting. And I guess you've been at OFGEM just over a year. Is it now, since you started there last year, what cultural shifts have you started to experience either within OFGEM or perhaps from your particular leadership impact team culture?

Speaker A: 16:36

So I think within ofgem I'm really seeing and I don't have the experience prior to when I started, so it's quite difficult to compare the before and after. But I am seeing a real focus on diversity, inclusion and making sure we create this diverse workforce, because I think we recognise that actually a diversity of views is really important. So I'm seeing a real focus on that at the organizational level. I think within my team, what I'm trying to do, because it's a new team, so I'm trying to create that culture of one team and I'm trying to create that kind of open culture where we're quite honest, including by providing constructive challenge with, with one another. And I think very much I'm very cognizant of the fact that lots of my team are spread across offices, work at home on different days. So it's really thinking about how we kind of create those touch points for two way communication. And also what was really struck me since I joined OFGEM is how many deep experts we have within the organization. We have so many people who are passionate, we have so many people that are real deep experts as well. And so I'm trying to, within my team create these opportunities to, to leverage that expertise to get those experts to really share their knowledge. And that's a real benefit to everyone else in the team as well. But it also has the benefit of kind of creating more that team atmosphere because we run these knowledge exchange sessions and it's really stimulating quite a lot of debate and it's bringing the team together. So that's something I'm quite proud that we're doing because it's working really well and it's working from a kind of pastoral, team building perspective. But also it's essentially free training kind of. We are sharing this expertise that we have within this organization. So it's really brilliant for the business as well because we're upskilling our colleagues.

Speaker B: 18:24

So bring in some fresh insights as well. I guess someone who's, you know, done a particular role has got some really like say deep knowledge in one particular area. Challenging some of those thoughts and, and yeah, allowing. Yeah, allowing that to happen.

Speaker A: 18:37

Exactly. And some of those questions from that. And that's again going back to the diversity point, that fresh perspect of asking some of those what are quite basic questions, but they're quite fundamental and we're seeing such change in the sector. I think sometimes we do need to step back and ask some of those quite fundamental questions. So we had a session yesterday on the wholesale, the electricity wholesale market, how it works and one of our colleagues had a question. Why is this pay as clear rather than pay as bid? It's quite a fundamental question and actually it caused everyone to step back and actually look at kind of why it was set up in that way and what the pros and cons are. So, yeah, I think those, those perspectives, those fresh perspectives are, are really important.

Speaker B: 19:16

Yeah. And also helps when you're building things for the future. To have had those thoughts about how and why we do the way. Do things the way we do it at the moment.

Speaker A: 19:23

Yes. Yeah, yeah, yeah. And not taking that as a given, like sometimes we do need to challenge those things. Yeah, absolutely.

Speaker B: 19:30

And then talking about sort of, obviously this, the industry, the water industry, the electricity industry, the energy industry is very sort of fast changing at the moment. How do you kind of support your team when working with that kind of uncertainty, that constant change? How do you sort of work with your team and support them in that sort of mind shift?

Speaker A: 19:47

So I think this year what we've tried to do is establish some clear priorities. I think we recognise the context within which we're operating. I think given the government's published its Clean Out, Clean Power Action plan, that, that provides some guardrails, doesn't it? We still don't know what the government wants to do with rima. We haven't seen a decision on that. But I think what we've tried to do within our teams at OFGEM is set quite clear priorities in terms of what we' we want to achieve over the next financial year and the budgets have been allocated on that basis as well. So we kind of, we have some certainty within the teams what we want to do. Obviously we may need to react if things change, if we see incidents or events. Obviously we need to kind of go back to those plans. But I think working with the teams to articulate a plan of what we would like to do and what we think our priorities are is really helpful. And I think that helps to provide some certainty in terms of what we'd like to achieve, how we're going to do it. But recognizing that obviously plans sometimes have to be changed if we see things that are unexpected.

Speaker B: 20:51

So I guess that's one of the challenges. But we've talked today about the various challenges in the sector at the moment. And with so many different organizations sort of driving and shaping the energy sector currently, you know, government talks about offgem, you know, and there's lots more in the mix there. What do you think are the challenges that the sector needs to face together during this period? I guess, of rapid change, transformation and increasing complexity? As we, you know, just talks about renewables and demand side response and things like that, you know, the sector is changing in complexity as well. Increasing.

Speaker A: 21:27

Yes, yeah. So I think resilience is a concept. I think all of the essential services sectors are really grappling with. I think it's an issue that involves regulators, government, industry to work together on. And resilience is multifaceted as well. I mean, we have. I mean, I'm responsible in offgen for security of suppliers that supply resilience, but we also have network resilience. I mean, we've seen some big storms recently and kind of we were trying to learn lessons and implement those lessons associated with sort of how the network operators have responded to those storms. We also have climate resilience, we also have cyber resilience. We also have financial resilience. So I think resilience is such a multifaceted issue and there are so many people and actors involved in this. I think this is an issue that all of the regulators are grappling with at present. And I think going forward that's going to be a real focus, including for the energy sector, sort of. What do we mean by resilience? What is the level of resilience we're aiming for across the entire sector? Kind of. And what does it mean to deliver that? I think we are starting to see a lot of conversations on this and I think this will be a real focus over the next couple of years, including, because we see examples every day, don't we, in different sectors? I mean, look at Marks and Spencer's and the recent cyber resilience attacks and the impact that had on their business. So.

Speaker B: 22:48

So any number of organizations within the sector.

Speaker A: 22:51

Yeah, yes, yes, I think that's a real issue that I think will be a focus for energy, but also other essential service sectors going forward. But goodness, it's so very complicated. It's multifaceted. I would not undermine the kind of the challenge associated with wrapping your arms around the issue and thinking about what it is we want to achieve. How do you define that? How much does that cost? How do you deliver it? Yeah, it's complex, but I think it is going to be a focus.

Speaker B: 23:19

Yeah. And I guess when you talk about resilience is resilience at all different levels, isn't it? It's resilience of the sector as a whole, all the way down to individuals that work within it or the consumers of it.

Speaker A: 23:30

Exactly, yes. And the system is complex and it's all interrelated. So it's if there is a single point of failure or an issue of resilience in one part of the system, kind of the possibility of containing that kind of is that possible. So, yeah, multifaceted, definitely. Complicated.

Speaker B: 23:49

Yeah. Blows my mind, really, when you, when you start to think about it and we've, we've covered loads of different ground and aspects of your role and your team, but I just wonder before, before we wrap up, have you got any final thoughts or remarks you want to sort of share with our audience?

Speaker A: 24:04

I think the only thing is, I didn't expect to have a career working in the utility sectors, but my experience today, it's been fantastic. So I think if there is anyone listening to this who's on the fence and is thinking about a career working in water or energy or one of the other utility sectors, I would say go for it. I think they're fascinating. There is so much to do and I think we really benefit in these sectors from a diversity of thought, perspectives, experience, etc. So I would just say go for it, because I didn't expect to have a career in, in these sectors, but it's been really fulfilling and really exciting and there's just so much to do. So go for it. That would be my advice. Advice.

Speaker B: 24:44

Oh, that's brilliant, Georgina. And that reflects so much other. So many other podcasts we have with other women who have had amazing careers within the sector and something obviously one, we want women to join the sector, to stay in the sector and to thrive. So thanks again, Georgina. It's been really fantastic to talk to you today and for our listeners. Thank you for joining us. Please have a look on our website, www.theone.co.uk and on there you can find out more about the events we have coming up as a network network, and also find more podcasts and blogs and details of our new development framework. And also, really importantly, on the website, you can sign up to become a member of one, which is completely free. You can also find and follow us on LinkedIn. Thank you so much, Georgina, for your time today. It was really great to talk to you.

Speaker A: 25:31

Thank you.

Speaker B: 25:32

And thank you to our listeners for joining us.

Speaker A: 25:40

It.