Ofgem has launched a consultation on proposed updates to its Offshore Transmission Cost Assessment Guidance (CAG). The proposed update reflects the increasing scale, complexity and technical diversity of offshore transmission projects, incorporating insights from bilateral workshops held with developers and offshore transmission owners between January and April 2026. Key proposals include rebalancing the Indicative Transfer Value (ITV) and Final Transfer Value (FTV) stages—making ITV the primary comprehensive review, commencing at least seven months before the completion notice, and streamlining FTV to cover only material changes since ITV. Benchmarking is proposed to be removed from the cost assessment process entirely, with assessment refocused on project-specific evidence such as procurement records and technical justification. The proposed update also introduces a structured spares classification framework with clearer evidencing expectations, and provides greater clarity on interest during construction, including the treatment of inactive or phased construction periods. The proposed update reflects the Planning and Infrastructure Act 2025 (PIA 2025)'s extension of the Generator Commissioning Clause from 18 to 27 months, and incorporates new guidance on anticipatory investment, community benefit, the clean industry bonus and the extension of tender revenue stream. Following the consultation, Ofgem is expected to refine the draft CAG and publish the final version later in 2026. The consultation closes on 7 September 2026.

Ofgem has launched a consultation on proposed updates to the Strategic Innovation Fund (SIF) Governance document, aimed at reflecting evolved processes and additional guidance after two years of implementation. Key changes include referencing an additional dissemination portal alongside associated quality and accessibility requirements, providing guidance on the application, assessment, and project delivery processes, defining two new terms, 'Cycle' and 'Stage Gate’, and updating organisational references such as the National Energy System Operator (NESO) and the Department for Energy Security and Net Zero (DESNZ). The consultation closes on 14 March 2025, with the final draft expected to be published in March 2025. Ofgem also intends to conduct a further consultation to address changes to the SIF programme in preparation for the RIIO-3 price control period.

Ofgem has launched a consultation on its minded-to methodology for valuing assets transferred from the natural gas network’s regulated asset base and repurposed for use in other regulated networks, such as CO2 transport and storage. Ofgem is minded to adopt a Depreciated Replacement Cost (DRC) methodology for this purpose. The consultation also seeks views on the management of costs incurred before and after asset transfers, and requests information on the scope and costs associated with repurposing assets for reuse in future hydrogen networks. The consultation closes on 1 July 2025, with a decision expected in Q3 or Q4 2025. If adopted, the DRC methodology will be integrated into the natural gas transporter licence conditions through modifications to the RIIO-3 regime.

Ofgem has published its final determination of the Data Communications Company’s (DCC) Required Revenue for the first ex-ante price control period, running from 2 November 2026 to 31 March 2028. Ofgem has set DCC’s Required Revenue at £1.163 billion, comprising £334.9 million for the five months to 31 March 2027 and £828.1 million for the 2027–28 regulatory year. The decision also covers the allocation of ringfenced funding to specified activities, approved drivers for automatic cost adjustments, additional pass-through costs and the outcomes DCC is expected to deliver during the price control period.

Ofgem has published a direction to the National Energy System Operator (NESO), extending the deadline for submitting the proposed Future Energy Pathways (FEP) methodology from 31 December 2024 to 31 January 2025. This extension, granted under Conditions C15.22 of the Electricity System Operator (ESO) Licence and C10.22 of the Gas System Planner (GSP) Licence, follows NESO's request submitted on 12 December 2024 under Part F of Condition C15 of the ESO Licence and Part F of Condition C10 of the GSP Licence.

Ofgem has announced amendments to the Initial Project Assessment (IPA) conditions for Window 3 (W3) interconnector projects and Offshore Hybrid Asset (OHA) pilot projects, extending their operational deadline from 2032 to 2035 in response to supply chain constraints. The change affects three interconnector projects (LirIC, MaresConnect and Tarchon), as well as two OHA pilot projects (LionLink and Nautilus).

Ofgem has published its decision and final registration guidance for heat networks following consultation on the draft. Stakeholders broadly supported the guidance but sought further explanation on complex and multi-party arrangements, ‘substantial control’, connected networks and proportionality for small or self-supply heat networks. Ofgem has amended the guidance by adding further detail and examples for self-supply, industrial and shared ground loop heat networks, clarifying evidence requirements and confirming registration will be managed through a digital service. The final guidance confirms a non-prescriptive, proportionate approach for networks with multiple operators, with nominated operators acting as the primary regulatory contact without assuming liability for others.

Ofgem has published a decision, outlining the further detailed regime parameters for the Offshore Hybrid Asset pilot scheme, following its September 2024 consultation. The scheme comprises two proposed non-standard interconnector (NSI) projects: LionLink and Nautilus, which will connect Great Britain to offshore converter stations, linked to offshore wind farms in the Netherlands and Belgium, respectively.  Following this decision, the pilot NSIs are expected to proceed with development to the final project assessment stage. Ofgem also plans to develop specific licence conditions for the NSIs, with a particular focus on the special conditions of the electricity interconnector licence to align with the new regime parameters.

Ofgem has finalised the Electricity (Early-Model Competitive Tenders for Onshore Transmission Licences) Regulations 2025 (Tender Regulations), which establish a legislative framework for competitive tendering in onshore electricity transmission projects and the granting of Competitively Appointed Transmission Owner licences. This follows Ofgem’s September 2024 consultation. The regulations have also been approved by the government. In addition, Ofgem has published a decision in response to its December 2024 consultation regarding the National Energy System Operator (NESO)’s November 2024 request to competitively tender a sub-component of project WCN2—a new double circuit between North-West England and South-West Scotland. Ofgem has decided not to confirm the needs case for this sub-component, citing uncertainties around the impact of the transitional Centralised Strategic Network Plan 2 Refresh and the Strategic Spatial Energy Plan on network requirements. A formal determination on whether the sub-component is a ‘qualifying project’ under regulation 6(3) of the Tender Regulations will be made once the regulations come into force on 25 April 2025.

Ofgem has published its decision to introduce updated licence application guidance with immediate effect, following a consultation held in April 2025. The guidance covers gas and electricity licence applications and incorporates several improvements, including updates to the descriptions of the tacit authorisation process, improved procedures for publishing application notices.

Ofgem has invited expressions of interest (EOI) for the new Smart Meter Communication Licence, as part of its review of the regulatory framework for the Data Communications Company (DCC) ahead of the expiry of its licence in September 2027. The EOI process aims to gather information from potential applicants about their intended applications, enabling Ofgem to assess their eligibility. It also seeks to inform Ofgem’s approach and design of the process for identifying, selecting, and awarding the next licence. The EOI closes on 11 April 2025.

Ofgem  has issued a call for input on draft Warm Home Discount (WHD) reconciliation guidance for scheme years 16–20. The draft guidance reflects amendments to the Warm Home Discount (Reconciliation) Regulations 2022 made by the Warm Home Discount (Reconciliation) (Amendment) Regulations 2026, SI 2026/991, including changes to the cost recovery mechanism from fixed standing charges to unit rates. The call for input closes on 27 October 2026.