Decision on further consultation on implementing the Discretionary Funding Mechanism under the Low Carbon Networks Fund
Decision
Publication date
Industry sector
Distribution Network
The Low Carbon Networks (LCN) Fund includes a Discretionary Funding Mechanism (DFM), which allows for up to £100m to be awarded to Distribution Network Operators (DNOs). This funding is available to provide discretionary rewards to certain projects, that bring particular value to the challenge of preparing networks for the low carbon economy.
This letter contains further decisions on implementing the DFM under the LCN Fund consultation. The decisions relate primarily to the Second Tier Reward (STR) and the First Tier Portfolio Reward (FTPR).
Below is a summary of our decisions. More details including our reasons and stakeholder responses are provided in the letter.
- Allocation of funding: funds not allocated to the Second Tier Successful Delivery Reward (SDR) will be split 4:1 between the STR and FTPR.
- Timing: there will be two assessments for the STR, one in 2018 and another two years after the final project has closed down. There will be one assessment for the FTPR in 2017.
- Assessment criteria: we propose to amend the evaluation criteria in the LCN Fund Governance Document to ensure they are relevant to an ex post assessment.
- Conducting the assessment: the electricity Network Innovation Competition Expert Panel will assess project performance and make a recommendation to the Authority. The Authority will make the final decision on the rewards that should be provided. We may provide guidance to applicants and the panel ahead of each assessment.
We will consult on implementing our decisions by proposing changes to the LCN Fund Governance Document.