Question to the Department for Energy Security & Net Zero:

To ask the Secretary of State for Energy Security and Net Zero, what assessment his Department has made of the potential impact of Ofgem’s RIIO-3 draft determinations for the electricity transmission, gas distribution and gas transmission sectors on the (a) financial resilience of energy suppliers and (b) risk of market disruption.

Ofgem, as the independent regulator, sets funding and investment allowances for gas and electricity transmission, and gas distribution networks through its RIIO-3 price control process. Final Determinations for RIIO-3 will be confirmed by Ofgem in December.

Ofgem has a statutory responsibility to maintain security of supply while incentivising efficiency and protecting consumers from excessive costs.

Following the energy crisis, Ofgem introduced capital adequacy rules to strengthen the financial resilience of suppliers and the stability of the retail market.

The Department will continue engaging with Ofgem to ensure RIIO-3 delivers the investment needed to maintain energy security through this period.