Return on regulatory equity: Gas distribution (RIIO-GD1)

Chart

Javascript is required to render chart Return on regulatory equity: Gas distribution (RIIO-GD1).

Source: RIIO gas distribution annual report 2017-18.

Information correct as of: March 2019

This chart is an indicator of financial performance. It shows our estimates of gas distribution network owners’ return on regulatory equity (RoRE). It is our current view of an eight-year average RoRE over RIIO-GD1.

We update this chart on an annual basis. Click the ‘more information’ tab above for a summary of the latest trends, details of how to interpret the figures and for information on methodology.

Policy Areas:

  • Electricity - distribution
  • Gas - distribution

Data Table

Return on regulatory equity: Gas distribution (RIIO-GD1)
Current eight-year view
Cadent12.59%
NGN12.73%
SGN11.18%
WWU9.39%

More information

At-a-glance summary

  • RoRE (inclusive of financing and tax) across the gas distribution sector is 11.5%,
  • It ranges from 9.4% for WWU and 12.7% for NGN.

Relevance and further information

  • RoRE helps us assess the financial performance of gas distribution networks under the price control.
  • RoRE should be compared to the cost of equity allowed at the start of the price control which was 6.7% for all of the gas distribution networks.
  • No gas distribution owners are forecast to earn returns below their cost of equity.

Methodology

  • Our RoRE calculation measures companies’ performance for the RIIO-1 period, this includes the first five years’ actual return and their forecast performance for the remaining three years of RIIO-GD1.
  • We report RoRE values for the companies compared against the assumptions we set for RIIO-1. Our RoRE now includes their actual and forecast financing (cost of debt) and tax performance. This is a new way of reporting RoRE, and values may not be comparable with the values we have published in the past.
  • Our calculation assumes all outputs will be delivered.
Date correct
March 2019
Policy areas