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Decision regarding the indexation of future OFTO and interconnector licences

Decision

Publication date

31 March 2016

Industry sector

Offshore Transmission Network
Transmission Network

Decision for

Indexation for future OFTO and interconnector licences

Indexation for OFTO Tender Round 4 (TR4)

We have taken the decision to continue using RPI as the measure for indexation in TR4.

Indexation for Interconnectors in Cap & Floor Window 2

For interconnectors, whilst we will continue to consider RPI as the default index, we intend to create greater flexibility for developers to propose alternative arrangements, to be assessed alongside all other elements of consumer value when considering cap and floor submissions.

RIIO

A number of respondents also took the opportunity to share their thinking on indexation in relation to RIIO. Our decision in respect of offshore tender rounds and interconnector submission windows has no implications for our indexation approach for RIIO. Our current RIIO regimes will continue to use RPI during the current control periods. Further information can be found in the decision letter.

Main document

Our decision to retain RPI as the inflation index for the upcoming Offshore Tenders Round 4 and as the default for the cap and floor interconnector regime.