The CRU has today, 22 July 2020, published its Price Review 5 Draft Determination Paper.
This paper seeks stakeholders views on the proposed determination for allowed revenues for distribution and transmission for 2021-2025. This consultation is broken into three separate parts:
- TSO and TAO Transmission Revenue (2021 – 2025)
- DSO Distribution Revenue (2021-2025)
- PR5 Regulatory Framework, Reporting and Incentives
Alongside these papers, the CRU has provided supplementary material including consultancy reports, submissions made by the network companies and the revenue models which are used to calculate allowed revenues in the period.
The Transmission Revenue and Distribution revenue reports outline the CRU’s current position on the appropriate level of revenues allowed for the network companies to efficiently deliver on the strategic objectives of PR5 while safely operating the system. These objectives are:
- Facilitating a Secure Low Carbon Future
- Transforming the Role of the DSO
- Increasing Efficiency and Protecting Customers
- Resolving Local Security of Supply
The CRU is seeking views as to whether the proposed allowed revenues are appropriate.
Separately to this, views are sought on the proposed regulatory framework and the reporting and incentives regime for PR5. The proposed framework builds on the framework which was put in place under PR4 and aims to ensure the network companies can react flexibly to potential uncertainty (in the form of both risks and opportunities) during the PR5 period while ensuring efficient costs for customers. This paper also considers the appropriate balance of risk and reward which network companies are exposed to during PR5.
This consultation will close on 18 September 2020. The CRU intends to publish all submissions received.