How we are funded
The industry regulator, Ofgem, provides funding to support innovation projects which deliver customer benefits. Gas distribution networks bid for this money under the Network Innovation Allowance (NIA) or the Network Innovation Competition (NIC).
Network Innovation Allowance
The NIA is an Ofgem incentive mechanism for funding smaller innovation projects that can deliver benefits to customers.
The NIA is a set annual allowance that allows us, and other network licensees a funding opportunity of 0.7 per cent of revenue to be spent on innovation projects, 90 per cent of which can be recovered through the incentive mechanism.
Network Innovation Competition
The NIC is an annual competition to fund flagship innovative projects which could deliver carbon or environmental benefits for gas customers, and that would not otherwise be funded.
This provides the opportunity for network licensees to work collaboratively. A maximum of two project submissions can be made to compete to obtain funding from the NIC; up to a maximum of £18m for the gas distribution industry.