We regulate new interconnector development in Great Britain (GB) under our cap and floor regime. As part of the regime framework, developers may request regime variations provided they can demonstrate that these are in the interests of consumers.
The developers of two projects, Greenlink and NeuConnect, have separately requested regime variations to enable them to attract the private financing required for their projects to continue through construction and operation. Some of the variations will have consumer impacts that were not accounted for when we approved the projects under the default regime at our Initial Project Assessment (IPA) stage.
This consultation sets out Ofgem’s minded-to position on proposed changes to our cap and floor regulatory framework for electricity interconnectors. These changes have been requested in order to broaden the sources of finance available for two interconnectors that are currently under development. We have assessed these requests in our consultation and in our supporting Impact Assessment (IA), which is published alongside this consultation.
We welcome stakeholder views on the developers’ requests, our Impact Assessment framework for assessing the requests, and our minded-to consultation positions.
This consultation will close on 28 November 2019. Subject to stakeholder responses, we aim to make our final decision on the proposed changes in early 2020.