Government response to Ofgem's RIIO3 Final Determinations

Statement from the Department for Energy Security and Net Zero, in response to Ofgem's publication this morning on the RIIO3 Final Determinations.

A Department for Energy Security and Net Zero spokesperson said: 

“This government is taking action to bring down energy bills for families, with the Budget taking an average £150 of costs off bills in April, and expanding our £150 Warm Home Discount to over six million families. 

“Upgrading our gas and electricity networks after years of underinvestment is essential to keep the lights on and ensure energy security for our country. Without these plans, which were first set out under the previous government, costs would spiral and our security would be compromised.  

"The only way to bring down bills for good and get off the fossil fuel rollercoaster is with this government's mission to deliver clean homegrown that we control.”  

Background 

• The plans set out by Ofgem for the period 2026-31 are necessary to keep the lights on after many years of underinvestment in our energy system, and will enable us to build a system that can bring down bills for good.  
• These are the same projects planned under the previous government. Ofgem published the draft figures in July 2025 and today's figures are lower than the drafts published in July due to intensive work on bearing down on costs.  
• The investments are in both the gas networks and the electricity network to ensure that energy can be transported across the country in a safe and reliable way.  
• The majority of this infrastructure was built in the 1960s and if we do not upgrade it then we will incur significantly higher costs, for example constraint costs. The electricity investment outlined here pays for itself in avoided costs we would incur by doing nothing. 
• Delivering clean power by 2030 is essential to driving down the cost of electricity and ensuring energy security for our country. For example, constraint costs can be reduced by £4-5bn if network reinforcements expected by 2030 are delivered, including projects such as the Norwich to Tilbury transmission line.   
• Upgrading the grid is essential to ensure that we have an energy system that can drive economic growth, bring down energy costs for industry and support the development of datacentres and new infrastructure. It is not possible to run a successful modern economy on infrastructure that is more than half a century old.  
• In the last year Ofgem have significantly strengthened their price controls to ensure value for money and guard against the risk of excessive returns to the network companies. Their scrutiny has delivered potential savings of over £4.5bn (15%) against the initial £33bn proposals. The price controls will allow for essential investment that will bring tangible benefits to consumers, including system efficiency savings that will offset the additional network costs, improved network resilience, and enhanced energy security by adding more renewables to the grid.