SSE PLC Ofgem RIIO-3 Sector Specific Methodology Decision
18 Julho 2024 - 3:31AM
RNS Regulatory News
RNS Number : 9110W
SSE PLC
18 July 2024
SSE plc
Ofgem RIIO-3 Sector Specific
Methodology Decision
18 July
2024
SSE notes today's publication of
Ofgem's Sector Specific Methodology Decision (SSMD), an important
step in the RIIO-3 regulatory price control process covering the
period between 2026 and 2031 for electricity
transmission.
The RIIO-3 price control comes at a
critical juncture in the transition to a cleaner, more secure and
affordable electricity system for current and future
generations. As Ofgem acknowledges, delivery of the UK and
Scottish Government's climate change and energy security targets
will require unprecedented and accelerated levels of strategic
investment in the country's electricity network
infrastructure. It is therefore vital that the new framework
reflects this urgency as well as the wider economic context against
which the necessary investment must be secured.
Ofgem's publication includes a number
of financial proposals which will require further detailed
assessment to determine the long-term investment implications. SSE
initial assessment is that Ofgem will need to aim up when setting
the cost of equity to deliver the scale of investment required to
build the future electricity network the country needs.
SSE also notes the methodology change
for the cost of debt calculation which will need careful analysis
alongside other changes to financial measures which have yet to be
finalised.
Barry O'Regan, Chief Financial Officer of SSE plc,
said:
"The benefits of taking a long-term, strategic approach to
investment in Britain's grid infrastructure have never been
clearer. With a new national mission to deliver clean power by 2030
in order to boost energy security and protect future consumers,
unlocking the right level of investment during the next price
control will be key.
"It
is crucial that Ofgem set an appropriate cost of equity that
recognises the high level of risk borne whilst attracting the
unprecedented levels of investment required to decarbonise the
economy and deliver net zero. Based on our initial
assessment, further work is required on the specifics around
investability that would enable the UK to compete for finance
globally.
"As
we continue to assess the detail of today's publication, we look
forward to working constructively with Ofgem, Government and wider
stakeholders to ensure the future regulatory framework delivers a
cleaner, more secure and affordable energy system for current and
future generations."
ENDS
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