Ofgem
Ofgem and the Department for Energy Security and Net Zero are jointly consulting on 2 Ofgem regulated licences for the National Energy System Operator (NESO) which cover its obligations regarding electricity and gas functions.
The consultation document also acts as a response to previous consultations and includes connected announcements.
Government and Ofgem previously set out a commitment to create a publicly owned body, theFuture System Operator (now called NESO), as an impartial expert, with responsibilities across both the electricity and gas systems.
The 2 licences will be regulated by Ofgem:
- an Electricity System Operator (ESO) licence covering its obligations regarding its electricity functions
- a Gas System Planner (GSP) licence covering its obligations regarding its gas functions
The licences will include conditions for:
- the business conduct and independence of NESO
- its strategic and operational functions
- its roles including the provision of advice and information to government
- its obligations concerning energy industry codes and charging
We are now consulting on:
- a proposal to grant (or treat as granted) an Electricity System Operator and a Gas System Planner licence
- modifications to various licence conditions which will be impacted by the creation of NESO and the designation of the Independent System Operator and Planner (ISOP)
We are consulting on these 2 elements now because they werent covered in our previous consultation, and are required for theNESOs Day 1 licences.
We also provide:
- a response to the August 2023 government and Ofgem joint FSO [NESO] second policy consultation
- a response to the September 2023 Ofgem non-statutory consultation on draft ESO and GSP licence conditions
- a response to the December 2023 Ofgem proposed draft amendments to other impacted licences which would be required as a result of designating NESO
- a response to the December 2023 Ofgem consultation on policy direction for the FSO [NESO] regulatory framework
- an update on inclusion of Strategic Spatial Energy Planning (SSEP) in the NESO licence
- an update on inclusion of Centralised Strategic Network Planning (CSNP) and Future Energy Pathways in the NESO licence
This consultation brings together the outputs of multiple non-statutory consultations across NESO licences, new roles, financial design and incentives, and consequential changes to other licences.
It provides the complete proposed NESO Day 1 licence conditions, subject to the conclusion of this consultation.
How to respond
Please copy your responses to both:
Documents
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