Modifications to the Biomethane Connections UIOLI governance document

Details of outcome

Following consultation, we have decided to modify the Biomethane Connections Use-It-Or-Lose-It (UIOLI) governance document to allow unused funding to be reallocated between networks within the same corporate group. This change is intended to provide greater flexibility and help ensure funding can be directed to eligible biomethane connection projects where demand arises within a corporate group.

Respondents were generally supportive of the proposed changes, although some sought clarification on the wider implications of the modification. We have considered all responses and set out our conclusions in the decision document.

Alongside this decision, there is a consequential consultation on modifications to Special Condition 3.21 of the Gas Transporter Licence. 

Read the full outcome

Consultation description

We are consulting on a proposed modification to the Biomethane Connections Use It or Lose It (UIOLI) governance document. The proposed change would allow gas distribution network (GDN) licensees that operate more than one distribution network to reallocate Biomethane Connections UIOLI allowances between those networks.

Under the current arrangements, funding is allocated on a network-by-network basis within each GDN group. However, recent evidence indicates that demand for biomethane connections can vary significantly between networks within the same licensee group. This can result in some networks having unused funding while others face constraints, potentially delaying projects that could deliver value for consumers.

The objective of this consultation is to seek stakeholder views on whether the proposed modifications would improve the operation of the Biomethane Connections UIOLI mechanism by enabling funding to follow demand more effectively. We consider that the proposed changes could improve the utilisation of available funding, support additional efficient biomethane connections, and deliver better value for consumers without increasing the overall funding available under the mechanism.