7th Sep 2020 08:39
(Alliance News) - National Grid PLC on Monday said the UK energy regulator's draft determinations are "unacceptable, not being in the interests of consumers, and not reflecting the views of our stakeholders".
The power grid operator said it submitted its responses to Ofgem's RIIO-2 draft determinations on Friday. National Grid said it complained about "the combination of the proposed low base level of total expenditure, the uncertainty around the approval process for additional [total expenditure] and the low allowed baseline return", and it said it proposed remedies.
On July 9, Ofgem published its draft determinations for the RIIO-2 price controls for the UK electricity transmission, gas transmission, and gas distribution sectors, and the electricity system operator. The price controls are due to start in April 2021 and run for five years, until the end of March 2026.
The outcome of the draft determinations is different from companies' business plan proposals across many elements of the price control.
Ntional Grid on Monday highlighted that it requires a flexible regulatory framework in order to maintain "reliable and resilient networks". However, the proposals within Ofgem's draft determination, in particular the combination of the proposed low base level of total expenditure, the uncertainty around the approval process for additional total expenditure and the low allowed baseline return and potential inability to achieve it, does not allow this, the company said.
Looking forward, National Grid said it will continue to engage with Ofgem at all levels to facilitate an agreement that can create "the right incentives" to drive the investment and innovation needed to allow the UK to meet its clean energy ambitions, at a cost that is acceptable to consumers.
National Grid shares were trading 1.2% higher in London on Monday at 843.60 pence each.
By Evelina Grecenko; [email protected]
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