Notice of intention not to reject modified gas distribution Network Output Measures (NOMs) methodology
Decision
Publication date
Industry sector
Distribution Network
RIIO (Revenue = Incentives + Innovation + Outputs) price control framework gives a greater focus on outputs and associated secondary deliverables. Secondary deliverables are leading indicators which enable us to monitor companies’ long-term performance. The Network Output Measures help to quantify the impact of the companies’ network expenditure.
Special Condition 4G of the gas transporter licences require Great Britain’s Gas Distribution Networks (GDNs) to have a Network Output Measures methodology (“NOMs Methodology”). The purpose of the methodology is to enable the comparative analysis of GDN’s asset management performance and provide more easily understandable information for the Authority, consumers, and other stakeholders.
On 17 August 2017, the GDNs submitted the proposed modified NOMs Methodology for the Authority’s review. Having reviewed the Licensees’ submissions, we are satisfied that modified Methodology better facilitates the achievement of the NOMs Methodology Objectives as set out in Special Condition 4G.
This notice sets out the Authority's intention not to reject the modified methodology. The modified NOMs Methodology (version no. V3.2) therefore comes into effect on the 15 September 2017 and GDNs are required to implement it from this date.