WIREDGOV

Energy regulator Ofgem has today published initial proposals for the revenues it will allow the four energy transmission companies to recover from consumers in the year from 1 April 2012 to 31 March 2013, under the one-year extension to the existing price control.

The current transmission price control runs from 1 April 2007 to 31 March 2012. It is to be extended by one year so that it finishes at the same time as the 2008-2013 gas distribution price control.

Ofgem decided to align the end dates of the two controls so that it can implement its new RIIO (revenue = incentives+innovation+outputs) model for regulating networks into the next transmission and gas distribution price controls at the same time. RIIO is designed to drive real benefits for consumers, providing companies with strong incentives to meet the challenges of delivering a sustainable energy sector at a lower cost than under our previous approach. RIIO puts sustainability alongside consumers at the heart of what network companies do. One feature of the RIIO model is longer-term price controls. This means that the next price controls for the gas distribution and energy transmission companies will run from 2013 to 2021.

The initial proposals consultation can be found here: http://www.ofgem.gov.uk/Networks/Trans/PriceControls/TPCR4Roll-over/Pages/TPCR4Roll-over.aspx 

1. The transmission price control relates to the four companies that own the high pressure gas mains and the high voltage power networks. These companies are: National Grid Gas, National Grid Electricity Transmission plc, Scottish Power Transmission Limited, and Scottish Hydro-Electric Transmission Limited.

2. Ofgem is the Office of the Gas and Electricity Markets, which supports the Gas and Electricity Markets Authority, the regulator of the gas and electricity industries in Great Britain. The Authority's powers and duties are largely provided for in statute, principally the Gas Act 1986, the Electricity Act 1989, the Utilities Act 2000, the Competition Act 1998, the Enterprise Act 2002, the Energy Act 2004 as well as arising from directly effective European Community legislation.