How we're regulated

Ofgem makes sure we’re delivering value for existing and future consumers while supporting the transition to a more decentralised and decarbonised energy system. They do this through our Regulatory Framework, which requires us to submit a regulatory business plan every two years and report on our performance within these periods to Ofgem. Ofgem also holds us to account for delivering on our obligations through two licences - Electricity System Operator (ESO) and Gas System Planner (GSP).

The services we provide and investment we need is informed by our own work and what our stakeholders want us to deliver. Our business plans are reviewed by Ofgem to determine whether our activities represent value for money, and how our performance will be evaluated.

April 2026 marks the beginning of our new enduring regulatory framework, which sets out how Ofgem will regulate us for the foreseeable future. It moves us away from the RIIO‑2 price‑control model and instead focuses on two‑year business plans, clearer accountability, stronger but more targeted reputational incentives, updated licence obligations, and a new Independent Challenge Panel to provide us with structured performance assessments. RIIO‑2 was a fixed five‑year financial framework inherited from the ESO, while the enduring framework is a more flexible, outcome‑focused model designed specifically for NESO’s role as an independent public corporation, emphasising performance, transparency, and value for consumers.