Ofgem’s Draft Determination for RIIO-ET3.

1 July 2025

National Grid plc

Ofgem's Draft Determination for RIIO-ET3

As part of the ongoing process towards agreeing a settlement for RIIO-ET3, Ofgem has today published its draft determination which covers our National Grid Electricity Transmission business for the period April 2026 to March 2031. This follows the submission of our final business plan in December, which was created through extensive engagement with national, regional and local stakeholders.

We are pleased to see Ofgem continuing to recognise the need for significant levels of investment in networks, and the requirement for an investable framework to support its delivery.

The Draft Determination covers Ofgem's proposed decisions on awarding allowances for a subset of the projects included in our submission, with the remainder expected to be confirmed through in-period processes. As such, we continue to expect to invest around £60 billion over the 5 years to March 2029 across the Group.

We will now review the detail contained within the Draft Determination to assess whether it delivers an investable overall financial package. We note that progress is needed on incentive opportunities which are both good for consumers and support investability, and we will work with Ofgem to provide further information where requested to support our capital investment plans.

As we move towards the Final Determination in December, we will continue working closely with Ofgem to agree a price control that ensures the reliable and affordable flow of clean electricity whilst also meeting the ramp-up in demand for power. A resilient, future-proofed network will be critical to economic competitiveness and growth for Britain in the years ahead.

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Many of these assumptions, risks and uncertainties relate to factors that are beyond National Grid's ability to control or estimate precisely, such as changes in laws or regulations and decisions by governmental bodies or regulators, including those relating to current and upcoming price controls in the UK and rate cases in the US; the timing of construction and delivery by third parties of new generation projects requiring connection; breaches of, or changes in, environmental, climate change and health and safety laws or regulations, including breaches or other incidents arising from the potentially harmful nature of its activities; network failure or interruption, the inability to carry out critical non-network operations and damage to infrastructure, due to adverse weather conditions including the impact of major storms as well as the results of climate change, due to counterparties being unable to deliver physical commodities; reliability of and access to IT systems, including due to the failure of or unauthorised access to or deliberate breaches of National Grid's systems and supporting technology; failure to adequately forecast and respond to disruptions in energy supply; performance against regulatory targets and standards and against National Grid's peers with the aim of delivering stakeholder expectations regarding costs and efficiency savings, as well as against targets and standards designed to support its role in the energy transition; and customers and counterparties (including financial institutions) failing to perform their obligations to the Company. 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