EVALUATION

AN INDEPENDENT EVALUATION OF THE LCNF
Another of the respondents has had two projects this year with the third party that
suggested the idea leading the project, they say they realise there must be a balance
between them generating ideas and others coming to them with ideas.
Finally, one of the respondents feels that third parties leading projects could have a
positive impact if supervised/safeguarded by the network operator.
A.1.6
Barriers That May Have Discouraged Project Partner Involvement (Q1.3.6)
Questions:
Are you aware of any barriers that may have discouraged project partner
involvement?
A.1.6.1 Summary of Responses
All of the respondents were aware of barriers apart from one that felt they knew of no
fundamental barriers to project partner involvement.
A.1.6.2 Intellectual Property Requirements
This was mentioned as barrier by two thirds of the respondents (four).
One of these respondents agrees with the requirements for new IP to be shared with all
DNOs, but some partners, especially SMEs, cannot work with such a funding model. They
have had an experience of an SME having to drop out as they felt they could not agree to
the new requirements particularly with respect to background IP.
Another of these respondents feels that if you address the issues at an early stage they
are manageable.
Finally, one of the respondents found it is only likely to be a barrier when the partner feels
the IP of the project will be the primary provider of financial numeration.
A.1.6.3 Lack of Flexibility
The lack of flexibility in the LCNF was brought up by two respondents as an issue, with
both commenting that with the nature of innovation i.e. an uncertain process, deviations
are to be expected, and they feel the set-up of the LCNF is restrictive in that sense.
One of the respondents commented that for a deviation from the original bid, there is a
change process that has the potential to expose all partners to risk. This leads to partners
putting forward projects with a high degree of certainty that will not change, putting off
those partners that are used to projects that adapt as they go.
The other respondent put forward their view that the 10% allowed variance on budget
lines items is very restrictive, though they agree with the use of controls, they think that
discourages parties entering as the need to keep the costs within the parameters would
restrict the potential of the idea.
A.1.6.4 Funding Required from Partners
One of the respondents mentioned projects in which value is spread across the energy
value chain where project partners have been required to contribute to the project funding
proportional to the benefits expected should the project be successful. In a competitive
market, with open IP as LCNF projects, there is not an opportunity for them to remunerate
PÖYRY MANAGEMENT CONSULTING
October 2016
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