CMA issues summary of final gas network appeal decisions as 31 October deadline nears

The Competition and Markets Authority published a summary of its final determinations on Thursday in gas network appeals against Ofgem’s price control decisions, ahead of a statutory deadline of 31 October.

The full determinations will be issued to the parties and to the intervener, Citizens Advice, and a non-sensitive version will be published in due course.

Citizens Advice, which represents household and small business energy users, argues that consumers “will not be passed on the full cost savings” from expected productivity gains.

The row centres on Ongoing Efficiency, a measure tied to the productivity gains that regulated gas networks are expected to deliver.

The Gas and Electricity Markets Authority (GEMA), Ofgem’s governing body, set that figure at 1%, while the gas distribution networks had each suggested 0.5%.

Citizens Advice opposes the appellants on this point, and says regulated network companies can outperform UK economy productivity, so even the 1% target falls short of what consumers could gain.

Northern Gas Networks argued that GEMA made errors in setting the figure, including relying on a labour productivity forecast rather than total factor productivity forecasts.

Five licence holders sought permission to appeal, and the CMA received four applications: from Cadent, Northern Gas Networks, Wales & West Utilities, and a joint one from Southern Gas Networks and Scotland Gas Networks.

The CMA granted permission on 31 March, finding that the appeal raised arguable points of substance that needed detailed consideration.

Permission came on condition that every appellant’s grounds on Ongoing Efficiency be considered together, with a separate Southern Gas Networks ground on Totex Model Allowances heard between that company, GEMA and the CMA.

The appeals challenge licence changes made on 3 February, which gave effect to RIIO-3 price control decisions of 4 December 2025 setting how much the companies can charge customers.

Under Ofgem’s RIIO framework, monopoly network companies are meant to have enough revenue to invest in and run their networks.

RIIO-3 runs for five years from 1 April 2026 to 31 March 2031, and replaces RIIO-2, which ends on 31 March 2026.

A summary of provisional determinations came on 14 August, and on 4 September the CMA extended the deadline by one month to 31 October after representations from the parties.

The appeals are being decided by a panel of three: Kirstin Baker as chair, with Robin Cohen and Colleen Keck.

The CMA allowed Citizens Advice to intervene on 28 April, limited to the Ongoing Efficiency grounds, citing its statutory role representing domestic and small business energy consumers in Great Britain.

GEMA has argued that its decision is “plainly justifiable”, and that a 1% figure matched independent expert advice and regulatory precedent.