Electricity company Northern Powergrid has been given permission to appeal against changes made to its distribution licences.
The Newcastle-based firm says decisions made by the Gas and Electricity Authority (GEMA) last year, which affect pricing, contain "errors of fact". Northern Powergrid, which is responsible for electricity distribution across the North East, Yorkshire and North Lincolnshire, says changes to its licences, made as part of the 'RIIO-ED2' price controls mean it is unable to invest properly in the network.
The Competition and Markets Authority, which has granted Northern Powergrid the opportunity to appeal, says it has appointed three panel members to determine the outcome, which is expected at the end of September. Ofgem requires distribution network operators (DNOs) such as Northern Powergrid to adhere to a regulatory framework known as a price control which are intended to protect consumers by setting an upper limit for the amount they can charge for use of their infrastructure.
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In a statement, Northern Powergrid said: "The mistakes mean that the terms of the settlement do not properly reflect GEMA’s intended decision and they need to be corrected so that the company can invest the right amount in the network over the next five years to improve reliability, resilience and the service delivered to customers."
An Ofgem spokesperson said: "In March the Competitions and Markets Authority confirmed its decision to allow Northern Powergrid to appeal elements of our final determinations for electricity distribution network funding for 2023 to 2028. We are now preparing our detailed response to those appeals in accordance with the statutory timetable."
Northern Powergrid's latest accounts, which are for 2021, show its North East business overall revenues rose from £355.6m to £385.2m, while operating profit rose from £125.21m to £147.6m. An interim dividend of £26m was paid out to shareholders, an increase on the previous year’s interim dividend of £25.4m.
The company said it had worked on an improvement plan during the year, which brought disruption from Storm Arwen, and included the development of a customer relationship management system and the roll-out of a system giving improved real-time customer communication during an outage.
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