Funding National Grid’s consequential costs from the separation of the Electricity System Operator
Decision
- Publication date
- Industry sector
- Transmission Network
On 1 October 2024, the National Energy System Operator (NESO) was established. To deliver NESO, the previous Electricity System Operator (ESO) was separated from National Grid plc (NG) and acquired by Government. This has led to consequential costs for NG resulting from the ESO no longer being part of NG’s shared services function.
In September, we published a consultation on our proposals for funding these consequential costs, through an adjustment to National Grid Electricity Transmission (NGET)'s totex allowance for the remaining duration of RIIO-2. We have reviewed the response we received, and this document sets out our policy decisions, as well as our rationale and consideration of the response.
We will soon be issuing a statutory consultation on modifications to NGET’s licence showing how we propose to implement our policy decision.