Review of allowance for gas system entry capacity at Fleetwood
Press release
Publication date
Industry sector
Transmission Network
Ofgem has today announced a review into the £268.3 million allowance that National Grid Gas Transmission (NGGT), a subsidiary of National Grid, was allowed in the RIIO-T1 price control which runs from 2013 to 2021. The allowance is for providing capacity at the Fleetwood entry point to the national high pressure gas pipeline in Lancashire.
NGGT’s obligation to provide this capacity was originally triggered by bids in the September 2006 Quarterly System Entry Capacity auction by a gas shipper. However, the shipper has since defaulted on payments and no longer has a right to the capacity. National Grid has since offered the entry capacity at auctions to other parties, and a gas shipper has successfully bid for some capacity at Fleetwood for one quarter in 2025.
Ofgem’s review will determine the appropriate treatment of this capacity obligation under the RIIO-T1 price control. This may reduce NGGT’s price control allowances and its capacity obligation. We will take account of stakeholder views on whether this entry capacity is still needed. Ofgem is planning to publish a consultation on its proposed approach in March 2017 and a final decision will be made early summer 2017.
Notes to editors
- See Ofgem's open letter: Review into the treatment of NGGT’s capacity obligation at Fleetwood under the RIIO-T1 price controls.
- For more information on the RIIO-T1 price controls.
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