Decision paper on BGE(UK) Ltd rate of return licence mod consultation

Published date29 June 2016
Energy SectorGas
Decision published pursuant to Article
14(8) of the Gas (Northern Ireland)
Order 1996
Modifications to GNI (UK)'s Gas
Conveyance Licence
Decision Paper
29th June 2016
About the Utility Regulator
The Utility Regulator is the independent non-ministerial government department
responsible for regulating Northern Ireland’s electricity, gas, water and sewerage
industries, to promote the short and long-term interests of consumers.
We are not a policy-making department of government, but we make sure that the
energy and water utility industries in Northern Ireland are regulated and
developed within ministerial policy as set out in our statutory duties.
We are governed by a Board of Directors and are accountable to the Northern
Ireland Assembly through financial and annual reporting obligations.
We are based at Queens House in the centre of Belfast. The Chief Executive
leads a management team of directors representing each of the key functional
areas in the organisation: Corporate Affairs; Electricity; Gas; Retail and Social;
and Water. The staff team includes economists, engineers, accountants, utility
specialists, legal advisors and administration professionals.
We will make a difference for consumers by
listening, innovating and leading.
Value and sustainability in energy and water.
Our Mission
Our Vision
Our Values
Be a best practice
regulator: transparent, consistent, proportional,
Be a united team.
Be collaborative and co-operative.
Be professional.
Listen and explain.
Make a difference
Act with integrity.
Consumer impact
This paper sets out the Utility Regulator's decision to make modifications to
the gas conveyance licence granted to BGE (UK) in February 2002. The
modifications amend the parameters within which the rate of return on capital
employed by the licence holder over a price control period may be set. This
document summarises the responses received to the statutory consultation
and our consideration of these responses. It also includes the text of the
modified licence condition.
This decision is likely to be of interest to the licensee affected, other
regulated companies in the energy industry, government and other statutory
bodies and consumer groups with an interest in the energy industry.
The modifications will enable the Utility Regulator to set a rate of return which
better reflects prevailing market conditions and the level of risk borne by the
licence holder. Consumers will benefit from the more efficient allocation of
capital that will follow the alignment of risk and return.

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