The regional Gas Distribution Networks (GDNs) are natural monopolies. As the industry regulator, we administer a price control regime that ensures GDNs can, through efficient operation, earn a fair return on their activities while controlling the end cost to consumers.
In a price control we set the revenues the GDN is allowed to earn from consumers, as well as the outputs they have to deliver in return. We also set incentives to encourage the delivery of these outputs.
The current price control (referred to as RIIO-GD1) runs from 1 April 2013 to 31 March 2021.
RIIO-GD1 uses the RIIO model (Revenue = Incentives + Innovation + Outputs) – our new model for network price controls. RIIO places particular emphasis on incentives to drive the innovation needed to deliver a sustainable energy network at value for money to existing and future consumers.
The previous price control (referred to as GDPCR) ended on 31 March 2013.