Decision to modify the PCFIs and licence conditions for gas and electricity transmission and distribution
Summary
Ofgem decides to modify the Price Control Financial Instruments (PCFIs) and associated licence conditions for gas and electricity transmission and distribution licensees.
Why it matters
Technical update to the financial instruments embedded in the price-control licence conditions. Affects how allowed revenue is calculated; mechanical rather than structural.
Areas affected
Related programmes
Memo
Decision to modify the PCFIs and licence conditions for gas and electricity transmission and distribution | Ofgem Please enable JavaScript in your web browser to get the best experience. BETA This site is currently in BETA. Help us improve by giving us your feedback . Close alert: Decision to modify the PCFIs and licence conditions for gas and electricity transmission and distribution Publication type: Decision Publication date: 1 July 2025 Topic: Energy network price controls Subtopic: RIIO-3 Decision for: Statutory consultation to modify the Price Control Financial Instruments and licence conditions for electricity and gas distribution and transmission Print this page Share the page Share on Facebook Share on Twitter Share on LinkedIn On 25 April 2025, the Authority published a statutory consultation proposing to modify the Price Control Financial Models (PCFMs), Price Control Financial Handbooks (PCFHs), Standard and Special Conditions for RIIO-GD2, RIIO-GT2, RIIO-ED2 and RIIO-ET2. The Price Control Financial Handbooks (PCFHs) are tracked to show the location of modifications relative to previously published versions. The Authority hereby directs the modifications to the Standard Conditions, Special Conditions, PCFMs and PCFHs in the manner indicated in the versions published on this page. The modifications include the following: New ET2 Special Licence conditions terms regarding Transitional Centralised Strategic Network Plan 2 (tCSNP2): Addition of Special Condition 3.44 Development Funding Price Control Deliverable and Use It Or Lose It Adjustment (DFt) in the ET licences; Addition of Special Condition 3.45 Delivery Track Pre-Construction Funding, Re-opener, Price Control Deliverable and Use It Or Lose It Adjustment (DTPCFt) in the ET licences; and Modification to Special Condition 1.1 Interpretation and definitions. Modification to the non-variant allowances in the GD2 PCFM; Modification to Special Condition 5.4 Vulnerability and carbon monoxide allowance (VCMt) in the GD licences; Addition of Special Condition: SpC 3.19 FSO transition allowance in the GT licence; Modification of Electricity Distribution Special Condition 9.8 Tax Reconciliation Assurance Statement; Modification of Electricity Distribution Special Condition 1.2 Definitions and references to the Electricity Distributors; and Modification of Electricity Standard Conditions 29 Restriction of activity and financial ring-fencing of the Distribution Business. Main document Decision on ET, ED, GT and GD PCFI and Licence Modifications [PDF, 461.41KB] Subsidiary documents Modifications to Licence Conditions [ZIP, 4.55MB] PCFI modifications - Schedule 1 and 2 [ZIP, 9.94MB] tCSNP2 Guidance and Submissions Requirements Document [PDF, 248.02KB] Direction to Issue the Transitional Centralised Strategic Network Plan 2 Guidance and Submission Requirements Document [PDF, 172.76KB] SpCs and PCFI Issues Log [XLSX, 52.73KB] Print this page Share the page Share on Facebook Share on Twitter Share on LinkedIn Close