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National Grid To Provide Response To Ofgem Consultation Documents In Early 2019

National Grid PLC (NG.L,NGG) said Tuesday that Ofgem has today published sector-specific consultation documents for the company's UK transmission businesses as part of the ongoing RIIO 2 regulatory process.

The detailed consultation covers a wide range of topics including the cost of capital, incentives, outputs and other financial parameters.

National Grid said it welcome Ofgem's continued commitment to the key principles of RIIO-T1 of incentives, innovation and output based regulation.

"The consultation is a very detailed document which we will need to work through; however we are disappointed with the proposed financial package, in particular the cost of equity range as we do not believe it appropriately reflects the level of risk borne by transmission networks," National Grid said.

The company added that in order to deliver the major capital programme required across its networks in a rapidly changing energy market, it needs to ensure the regulatory framework also provides for fair returns to shareholders and will enable the company to continue to deliver world class networks for consumers.

National Grid will provide a detailed response to the consultation in early 2019. This consultation is expected to conclude in the second quarter of 2019 with the RIIO 2 price control commencing in April 2021.

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