Introduction of RIIO Accounts – further consultation on licence modification

Publication date
8th November 2017
Closing date
6th December 2017
Policy areas
Status

We propose to introduce the requirement for licensed network operators (NWOs) to prepare and publish RIIO accounts for the Regulatory Year 2017-18. These will provide investors and other stakeholders with more transparent and relevant regulatory accounting information. Under our proposals, the first RIIO Accounts will be published by the end of September 2018 and NWOs will no longer be required to prepare Regulatory Accounts.

The aim of RIIO Accounts is to provide a step change in the quality of reported financial performance by NWOs. They will be the primary source for anyone who wants to understand the network companies’ financial performance against the RIIO regulatory frameworks that we set, providing reliable and assured (audited) information about how they are creating value for investors and consumers under our incentive regimes. This information will be available in the public domain for the first time.

In November 2015 we consulted on our proposed framework. This included a draft modification to the existing licence condition. In March 2016 we said in our RIIO Accounts: Update letter and next steps (our March 2016 letter) that we would consider licence modifications after further work had been progressed. Due to the ongoing work we have carried out since that consultation, to develop the Ofgem Regulatory Financial Reporting Standard (ORFRS), we consider it appropriate to further consult.