Our response to Ofgem's framework consultation

At Cadent, we exist to keep the energy flowing. We own and operate 4 of the 8 Gas Distribution networks and serve over 11 million homes, offices and wider UK industry.  We operate across the North West, West Midlands, East of England and North London and are the largest Gas Distribution company in the UK, employing over 10,000 people across our networks.
 
Ofgem's RIIO-2 framework consultation is a critical decision point that will not only shape the industry for the next five years but out to 2050 and beyond. As such, the RIIO objectives of encouraging network companies to play a full role in the delivery of a sustainable energy sector and deliver long-term value for money for existing and future consumers are more important than ever.
 
We have already been working with our stakeholders and canvassing their views and have identified the following four key messages:

 

  • The RIIO framework has been a success delivering service quality improvements and efficiency for all of our customers providing a strong platform to build on for RIIO-GD2.  This evolution should be underpinned by enhanced engagement across our diverse customer and stakeholder base reflecting our four regions and ensuring there is legitimacy behind our plans.
 
  • The biggest challenge facing the UK energy networks is the decarbonisation of heat and transport.  Achieving the UK’s 2050 targets in the least cost manner and causing the least disruption to customers will mean the gas networks must play a vital role.  The RIIO-2 framework must encourage this long term thinking around asset management, innovation and the market and regulatory frameworks required to support this transition.
 
  • To secure the substantial investment required in the energy networks, either capital investment or investment in new technologies, and to continue the success of driving innovation, long term efficiency and better service, networks must be able to achieve attractive but fair returns.  These returns should be supported through service quality improvements that are in the interests of, and supported by, our customers. 
 
  • Finally, collaboration across the industry will be critical in delivering against the increasing demands of our customers and stakeholders and the 2050 targets for decarbonisation.  Collaboration allows us to ensure that best practice and innovations are deployed with minimal delay across all network areas, it allows us to work on cross sector and cross network projects to explore new technologies to advance the decarbonisation agenda and for networks to share best practice on all areas improving service, cost and delivery.

Downloads

Response to RIIO-2 Sector Specific Methodology Cross Sector
Response to RIIO-2 Sector Specific Methodology Annex-Gas
Response to RIIO-2 Sector Specific Methodology Annex-Finance

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