Market efficiency, review and reform

National Grid Gas plc is the system operator for Britain’s gas National Transmission System (NTS). It is responsible for maintaining residual balancing of the system so that demand and supplies are balanced and the system can be operated safely.

It is important that National Grid has appropriate commercial incentives to operate the gas NTS in an economic and efficient manner, as they are required to do under the terms of their licence as the System Operator.

To achieve this we work to develop incentive schemes that provide National Grid with an appropriate balance of risk and reward. At the same time, we also try to protect the interests of present and future consumers, who ultimately pay for the costs of system operation.

Cash out arrangements and the System Operator incentive schemes form part of our overall work to regulate the NTS monopolies and to work towards maintaining market efficiency.

We monitor developments in the gas market and facilitating changes to the market arrangements where it is economic and efficient to do so.

We also undertake work to protect customers’ interests in respect of securing Britain’s gas supplies, as well as monitoring and investigating activities which may harm competition.

Publications and updates

  • Published: 25th Nov 2003
  • Other
  • 1 Associated documents
Summary of views from DTI and Ofgem of regulation of LNG import terminals and interconnectors.