2025-108 Accredited MSc Programme in Energy Regulation

Title: Market Engagement Notice for 2025-108 Accredited MSc Programme in Energy Regulation 1. Background Ofgem regulates a complex and fast changing energy system.

Decarbonisation, infrastructure delivery, system security, digitisation, changing market economics, evolving consumer behaviour, and rapid technology change all require adaptive regulatory frameworks and deep sector expertise. The recent Ofgem Review highlights the need for Ofgem’s capabilities to keep pace with the changing energy system.

There is no current learning framework or training provision that is specific to upskilling staff in the specialist knowledge, skills and expertise to fully meet Ofgem’s complex and evolving regulatory, technical and policy responsibilities. As part of a wider capability plan, Ofgem intends to explore sponsoring a subset of staff for accredited higher education in energy system regulation.

There is a strong preference that this should be accessible through a modular structure that allows colleagues to take standalone modules, potentially (but not necessarily) leading to certification alongside PGDip and MSc pathways. Desk-top research indicates that whilst some higher education institutions offer modules as part of current MSc programmes that provide elements of the learning Ofgem requires, such modules are not individually accessible and no single programme provides the sector-specific blend of regulatory finance, policy, systems understanding, analytical skills, and practical capability required to deepen technical and regulatory expertise across Ofgem’s full remit. 2.

Indicative outline requirement Ofgem is, therefore, seeking market input on the feasibility of an accredited programme that can be delivered as a modular pathway (enrolment on individual or multiple modules) that can lead to: •no award (learning only) and/or •credit bearing awards (e.g., PGCert / PGDip) and/or •a full MSc (or stackable credits towards MSc) for a smaller number of staff. Ofgem would like to explore options relating to a cohort taking the full MSc as well as access to individual modules.

Ofgem is open to the modules being open to other students or a blend of open and closed modules if there are learning benefits of specific modules being restricted. To guide respondents, Ofgem has identified the following themes: i.

Low carbon market design ii. Regulatory finance and economics iii.

Power system dynamics and operation (no engineering prerequisite) iv. Regulatory policy and systems thinking v.

Secure and intelligent energy systems (cyber/data/AI) vi. Consumer protection in complexity and crisis An outline of the proposed learning requirements has been included under each of these six thematic areas at Annex A.

Ofgem is open to input on how each theme can be delivered, combined, adapted, or improved. 3. Target audience / learner profiles The target audience is mid-career professionals, particularly those within Ofgem’s strategy, policy, analysis, and engineering professions.

Ofgem intends the MSc programme and its modules to be accessible across all its directorates. It expects some business areas to have interest across all modules, while some will have narrower interest in one or more modules, depending on their remit and responsibilities.

Ofgem is prepared to sponsor a cohort for the full MSc (or PGCert / PGDip) should cohort/learner volume commitments improve value for money above ‘pay as you go’ options. Ideally, Ofgem may also fund learners for individual modules according to demand.

The intention is that other public bodies, in particular Department of Energy Security and Net Zero (DESNZ), will also be able to access modules and the full MSc (if applicable). However, while these bodies will have access, Ofgem will be the primary contract holder. 4.

Cohort commitments and costing Ofgem’s preference is for flexibility in how such a course and / or modules might be delivered. For example, a blend of ‘pay-as-you-go’ costing per student per module as well as costings for a full MSc.

However, it is understood that a minimum cohort and/or design fees may be necessary to ensure viability. Therefore, Ofgem is seeking a better understanding of the delivery models and commitments required to develop a modular and full MSc offering that meets requirements.

If a cohort minimum is required for either specific module(s) and/or the full MSc to ensure viability, Ofgem anticipates that the contract value will reflect the numbers required and whether modules need bespoke design or adaptation from existing materials. Respondents are asked to estimate costings in in the relevant section of the preliminary market engagement questionnaire.

Annex A: Six indicative thematic areas These are indicative thematic areas that could inform module development and give an initial outline of Ofgem’s areas of interest. It should be considered as a starting point to guide respondents on Ofgem’s thinking on the learning requirements.

Ofgem is open to further developing or taking questions on these outline requirements. Theme 1: Low carbon market design One area of focus is market design and future markets.

The intention is to develop thinking and test proposals for how market design can evolve in response to technology and politics. This includes a focus on the commercial realities for market participants (e.g. generators, transmission owners, distribution network operators) such that Ofgem students attain a deeper understanding of the impact of interventions and how to structure and incentivise an economic and efficient system.

This module could have an international element considering/comparing market design options as part of exploring the optimal GB design options. This thematic area could include: •connections process options to improve system design, lower costs for consumers and acceleration net zero •strategic planning: from modelling to overseeing implementation •the evolution of energy codes and licensing and the role of Ofgem •use of system, charging models and cost allocation in a low carbon market •The role of subsidies including contracts for difference and cap & floor arrangements and alternative to these interventions •system operation, the role NESO, onshore and offshore TOs, zonal constraints •maintaining security of supply in a complex market and the role of the capacity market •financing , notional structures, liquidity, cross-subsidy and intergenerational fairness •strategic investment cases: anticipatory investment •radical and alternative system and market designs Theme 2: Regulatory theory and economics One area of focus is: competition theory; regulatory theory and economic analysis within the energy sector.

This thematic area could include teaching on: •theories of regulation and the evolution of regulation •reasons for intervention in the energy market •competing economic theories / perspectives •allowed revenue building blocks, Regulated Asset Base (RAB) •incentives/outputs, uncertainty mechanisms •impact assessments including cost benefit analysis and evaluation •modelling and distributional impacts of interventions •case study or price-control determination simulation Theme 3: Power system dynamics and operation One area of focus is providing learning on the engineering and underlying physics of energy and power systems without requiring engineering knowledge as a pre-requisite. This exposure to engineering realities should support understanding of licensees and regulatory impacts.

Learning could include: •substation design, optimisation and future-proofing •intermittent generators, inertia and frequency control •offshore and onshore connections, enabling works and asset ownership. Theme 4: Regulatory policy delivery One area of focus is on end-to-end policy development and delivery (problem definition through to delivery) in the unique context of the GB energy system: •strategic and ‘systems’ thinking in energy sector policy design •regulatory policy options development •managing policy as a programme •policy and programme risk management Theme 5: Secure and intelligent energy systems (cyber / data / AI in energy regulation) This thematic area would provide Ofgem students with a grounding in this fast-moving area including: the risks and opportunities of Cyber and AI, regulatory options for AI, and how AI can optimise energy use and provide benefits to consumers.

This module should include a focus on digital/AI literacy and equip students to regulate a digitised, decentralised, evolving system. This module could include: •AI regulation and assurance: balancing risks and opportunities •flexibility markets (balancing, ancillary, local flexibility), revenue stacking, congestion •strategies to ensure the energy ecosystem is resilient to cyber and security attacks and can unlock flexibility •smart systems and data architecture (data access, interoperability, governance) •cyber resilience and operational risk in energy system regulation Theme 6: Consumer protection in complexity and crisis This thematic area would have a focus on the retail market and consumers, including segments of consumers, consumer lived experience of the market, behavioural interventions, incentivisation of choice, debt, debt relief and the future of crisis intervention.

This would bring a human perspective to policymakers as well as practical support on compliance and enforcing rules with suppliers. Could include: • retail market design and compliance • price cap mechanics • levies and the mechanics of policy costs pass-through to billing • affordability, debt, and intervention options to address affordability and debt challenges • consumer choice and flexibility • crises and intervention Theme 7: an applied / practical component As part of the programme, Ofgem is interested in an applied research/policy/practical project or dissertation relevant to a learner’s business area and capable of generating practical outcome