Energy UK response to Ofgem’s Call for Input on Locational Charges and Regulatory Siting Levers Under Reformed National Pricing

Executive summary

Energy UK welcomes Ofgem’s work on Locational Charges and Regulatory Siting Levers under Reformed National Pricing (RNP), and would note the following core positions:

• The current network charging framework must be reformed through both immediate actions to reduce uncertainty and longer-term holistic reform to align with wider levers being explored in the DESNZ RNP Delivery Plan.
• Ofgem must continue to engage with a wide range of stakeholders to consider the actual impacts and consequences of any changes before implementation.
• Coordination of this work with the Cost Allocation and Recovery review is critical, as the impact on affordability must be considered.
• Action to address uncertainty should be urgently pursued, in light of upcoming market and support mechanism auctions, to reduce the risk premia applied to projects critical to delivery of Clean Power 2030.

Sector confidence is low following significant delays to critical workstreams, market uncertainty, and geopolitical circumstances. Energy UK would welcome closer, more regular engagement and the broader consideration of actions DESNZ, Ofgem, and NESO can take to improve the investment signals for developers.

If you would like to discuss anything noted in this response in more detail, please do get in touch.

Sincerely,

Charles Wood
Deputy Director, Policy
Charles.Wood@Energy-UK.org.uk