Transition to GD3
Overview of Ofgem's proposed plans
Key points proposed in Sector Specific Methodology Decision:
- VCMA to remain as 'use it or lose it' allowance
- VCMA funding level to return to original GD2 equivalent (c£9m for NGN)
- Retain minimum 25% collaborative spend allowance
- FPNES scheme to close at end of GD2
- GDNs to support journey to Net Zero, ensuring vulnerable consumers are not left behind in the transition
High level overview of the commitments we have made within the business plan:
Your influence - How stakeholder feedback shaped our plan
Layout/design
- Format of strategy and business plan refined for ease of reading and clearer understanding. Reduced to 23 vulnerability commitments
Level of VCMA funding
- Increased VCMA allowance in final plan (£10.9m in draft, £15.9m in final)
Social Return on Investment (SROI) measurement
- SROI target removed from final business plan. Work is ongoing to make sure SROI considers benefits beyond those which are immediately obvious and measurable (e.g. health/wellbeing impact). More focus on the power of case studies, and impact measurement beyond SROI
Maximising collaboration opportunities
- Collaborative narrative was strengthened in business plan, and three commitments included for regional collaborative strategy – PSR, Vulnerability Investment, Severe Incident Response
Supporting CIVS through the energy transition
- Focus on collaboration with industry to support those most at risk to achieve a just and fair transition
- Expanded current commitment to Centres for Warmth (CfW), to endure in GD3. Explored with NEA about joining up Community Retrofit Hubs and CfW – combined, they could become Centres for Future Warmth (this is a commitment in our CfW Strategy)
Maximising impact – shareholder funding
- Commitment to increased funding and applying SROI where appropriate to shareholder funded projects
- Commitment to grow additional small/seed funded projects into VCMA
Supporting relationships with partners/communities
- Engaging with regional and national stakeholders to understand what support can be provided over next 12 months. Committed to open and prompt information following Draft Determination outcome
- NGN Open Day to be earlier this year, with focus on opening opportunities for alternative funding/supporting sustainability
- Track record of ensuring relationships with partners beyond funding cycles – will continue to strengthen this approach
High level Vulnerability Outputs
23 Ambitious Voluntary Commitments to support our customers in most need
These include:
- Over 25,000 highest risk households to be supported with in-depth case work
- Over 90,000 households to be supported with one-to-one awareness, signposting and lower-level advice
To note, these numbers are based on receiving the requested VCMA Allowance of £15.9m
- Assess all VCMA projects against the new NGN Inclusivity and Vulnerability Impact Assessment tool
- £1.3m shareholder investment into NGN Customer Support Fund and NGN Community Partnering Fund
- All Unbilled Energy revenue (Theft of Gas) to supplement NGN Customer Support Fund
- Regional collaborative PSR awareness strategy
- Regional collaborative vulnerability investment strategy
Next steps for our plan
Key priority focus areas during transition to GD3
The following priority areas have been identified to guide our transition:
- Continue to support projects to become sustainable
- Development of the NGN Inclusivity Assessment Tool
- Development of outputs related to our approach to a fair and just transition
- Development of collaborative PSR awareness strategy
- Development of collaborative investment strategy with DNOs
- Planning for future Carbon Monoxide (CO) awareness/education
- Review of reporting processes/templates
