REG - SSE Plc - SSENT response to RIIO-T3 Draft Determination

SSEAnnouncement

01/07/2025 07:10

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RNS Number : 1610P  SSE PLC  01 July 2025

SSEN Transmission response to Ofgem's RIIO-T3 Price Control Draft
Determination

SSEN Transmission notes today's publication of Ofgem's Draft Determination for
the RIIO-T3 price control period, which comes at a critical juncture in the
country's transition to a cleaner, more secure and more affordable energy
system.

Investment in the electricity transmission network is the key enabler to
achieving these national objectives and bringing down consumer bills by
enabling the rapid deployment of homegrown, low-carbon electricity generation,
underpinning the UK Government's Clean Power 2030 Mission and the Scottish
Government's net zero ambitions.

SSEN Transmission acknowledges Ofgem's recognition of the criticality and
unprecedented nature of this national infrastructure challenge and notes there
has been some positive movement following the regulator's Sector Specific
Methodology decision in July 2024.

However, based on an initial assessment, Ofgem's Draft Determination does not
go far enough to deliver the investible, financeable and ambitious framework
required to unlock the unprecedented levels of investment needed to deliver
lower and more stable bills. In particular:

·    the approach to setting baseline total expenditure allowances fails
to fund the investment necessary to deliver a clean power system by 2030. The
methodology adopted does not reflect the true, evidence-based costs that are
required to develop, build and maintain a reliable electricity transmission
network in the north of Scotland.

·    the proposed Cost of Equity is not commensurate with globally
competitive market rates, robust market evidence, and the significant business
risks of investing in electricity transmission.

·    the proposed capitalisation rate, and asset lives, do not provide
adequate cash flow measures given the significant increase in uncertainty
mechanism expenditure required.

·    the proposed incentive regime is at an early stage and therefore
requires further development to give sufficient confidence this will be a
balanced and investable package that incentivises strong performance and
delivers for consumers.

SSEN Transmission will now consider Ofgem's Draft Determination in detail over
the coming weeks and will continue to work constructively with Ofgem,
Government and wider stakeholders to ensure Ofgem's Final Determination
delivers an investible, financeable and ambitious price control settlement to
underpin the unprecedented levels of investment required to deliver a cleaner,
more secure and more affordable energy system to meet the needs of current and
future generations.

 

Notes

SSEN Transmission's dedicated Business Plan website:

www.ssen-transmission.co.uk/RIIO-T3
(http://www.ssen-transmission.co.uk/RIIO-T3)

About SSEN Transmission

·    Headquartered in Perth - with offices in Aberdeen, Inverness and
Glasgow - SSEN Transmission is responsible for the electricity transmission
network in the north of Scotland, investing in and maintaining the high
voltage 132kV, 220kV, 275kV and 400kV electricity transmission network.

·    SSEN Transmission's strategic objective is to enable the transition
to a low carbon economy, helping to secure the country's clean power and
energy security ambitions. It does this by building the electricity
transmission network infrastructure required to connect and transport
renewable electricity in the north of Scotland to the towns, villages and
cities where it's needed, as it delivers a network for net zero emissions.

·    SSEN Transmission is owned 75% by SSE plc and 25% by Ontario
Teachers' Pension Plan Board (Ontario Teachers').

·    Learn more about SSEN Transmission by visiting
www.ssen-transmission.co.uk (http://www.ssen-transmission.co.uk/) , X
(https://twitter.com/SSETransmission) , LinkedIn
(https://www.linkedin.com/company/ssen-transmission/) or Instagram
(https://www.instagram.com/ssentransmission/) .

 

 Enquiries
 Investors   SSE Investor Relations  ir@sse.com     Michael Livingston  +44 (0)345 0760 530
 Media       SSE Media               media@sse.com  Greg Clarke         +44 (0)345 0760 530

 

 

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