We have issued Notices under section 11A(2) of the Electricity Act 1989 and under section 23(2) of the Gas Act 1986 to the relevant licence holders. The proposed drafting can be found in the relevant Statutory Notices appended to the letter. See subsidiary documents below.
Representations on the proposed modifications must be made on, or before, 25 October 2016.
The Funding Return Mechanism (FRM) is the method by which we can direct money associated with an innovation project (funded under Low Carbon Networks Fund or Network Innovation Competition) to be returned to customers (eg if a project is halted early). We propose to make changes to these licence conditions to broaden the use of the FRM. The mechanism is not intended to be used to return revenue streams identified retrospectively. The proposed changes formalise practices that are already taking place and provides clarity on the relevant arrangements for new projects.