National Grid ESO is to develop proposals for the potential introduction of early model competition in onshore transmission.
The Competitive Appointed Transmission Owner (CATO) regime – which falls under Ofgem’s jurisdiction – was created with the intention of driving innovation and reducing the costs passed on to the consumer.
This is achieved through the introduction of a competition for the building, owning and operating of assets that are required to meet a need on the transmission system and are new, separable and with a predicted capital expenditure of over £100 million.
Having been requested to develop the proposals by Ofgem, National Grid ESO is looking for industry input from companies that might participate in a CATO competition. This includes design, construction and financing companies with a direct interest in the regime.
The system operator is looking for feedback on areas such as how tenders could be launched and how ongoing uncertainty is best managed, with the aim of making its proposed model “simple and accessible”.
A series of workshops is to be run to gather views on how the proposals should be developed to maximise participation, as well as webinars to provide more information about the overall project.
Fintan Slye, director of UK system operator at National Grid ESO, said: “We’re excited about what this could mean for both the industry and consumers. We believe that early competition has the potential to unlock significant consumer value and drive innovation in network development.”