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Ofgem
Ofgem removes £277.5 million funding from National Grid's gas transmission price control allowances



Aug 8, 2017

Ofgem is removing £277.5 million funding from National Grid's price control allowance. This was for new pipelines and other network upgrades needed to provide capacity at the Fleetwood entry point to the national transmission system (NTS), a high-pressure gas pipeline.

Ofgem said at the start of the price control that it would review the Fleetwood funding arrangements to ensure that consumers are protected.

Ofgem launched the review in November 2016.

National Grid's obligation to provide this capacity was originally triggered by bids in the September 2006 auction for NTS entry capacity. However, the gas shipper that bought the capacity has since defaulted on payments and no longer has a right to it. National Grid has since offered the entry capacity at auctions to other parties, and a gas shipper has successfully bid for some capacity at Fleetwood for one quarter in 2025.

Ofgem has decided to remove the £277.5 million funding as National Grid does not expect to incur further expenditure on providing the capacity during its current price control (2013-2021).

Ofgem has also decided to reduce National Grid's obligation to provide capacity at Fleetwood from 650 gigawatt hours (GWh) per day to 350 GWh/day.

Background

  1. Ofgem has published a decision on Fleetwood entry point in gas transmission. 

About Ofgem

Ofgem is the independent energy regulator for Great Britain. Its priority is to make a positive difference for consumers by promoting competition in the energy markets and regulating networks.

For facts, figures and information about Ofgem's work, see Energy facts and figures or visit the Ofgem Data Portal

Contact
Chris Lock: 0207 901 7225
Media out of hours mobile: 07766 511470 (media calls only)

For more information:

Organization:
Ofgem
https://www.ofgem.gov.uk/


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