The Office of Gas and Electricity Markets (Ofgem) required an Interim Head of its RIIO (Revenue = Incentives + Innovation + Outputs) Finance & Investor Relations team to oversee the team’s work until a new, permanent head was appointed. The key objectives were to ensure the quality and timely delivery of the team’s projects, contribute to directorate management, and develop wider interaction within Ofgem. Subsequently, Ofgem’s Gas Networks Team required support assessing the proposed sale of National Grid’s majority stake in its four gas distribution networks.
Interim Head of RIIO Finance & Investor Relations
IPA seconded a Managing Consultant to Ofgem to fulfil this role. The scope of the team’s work included: the price control financial model (PCFM) for the gas and electricity distribution and transmission RIIO price controls; the annual iteration process (AIP) for updating network companies’ revenues; financial aspects of network reporting; ring-fencing provisions and financial stability; and oversight of network corporate governance and licence compliance. The IPA employee oversaw this work reporting directly to the Network Senior Partner and developed a Team Action Plan to improve the team’s morale, knowledge and performance.
Analytical Support to Gas Networks Team
Upon moving to the Gas Networks Team, the IPA secondee provided analytical support for Ofgem’s activities on National Grid’s proposed sale of a majority stake in its four gas distribution networks. This included developing consultation documents, drafting licence condition amendments, and publishing decision documents, tasks which required extensive consultation with internal and external stakeholders (including National Grid, Health & Safety Executive, Department of Energy and Climate Change, and other external advisers). The secondee also supported the team in its analysis of Xoserve’s costs and consideration of the appropriate means for the recovery of costs within the RIIO price control framework to help inform Ofgem’s decision on funding.