Further instructions to electricity transmission licensees on modifications to their Network Output Measures Methodology
Correspondence and other
Publication date
Industry sector
Transmission Network
Our 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.
Electricity transmission licences require Great Britain’s onshore electricity transmission network owners (TOs) to have a Network Output Measures methodology (“NOMs Methodology”) to explains how we can quantify the impact of the actions taken and expenditure incurred by the companies on their networks, and enables Ofgem and stakeholders to see what the companies have delivered and what to expect in return for future investments.
In April 2017, the electricity transmission licensees submitted a modified Network Output Measures (NOMs) Common Methodology in compliance with a Direction we issued in April 2016. This letter explains the reasons for not rejecting that Methodology, and provides instructions to Licensees on further development of their methodology to fully meet the requirements of the Direction, as well as additional work necessary to meet the NOMs Objectives.