Response to statutory consultation on National Energy System Operator licences and other impacted licences

In March 2024, the Secretary of State for Energy Security and Net Zero proposed to grant (or treat as granted) an Electricity System Operator (ESO) and a Gas System Planner (GSP) licence, and to make modifications to the conditions of other existing licences. This statutory consultation set out the full draft ESO and GSP licences that the National Energy System Operator (NESO) is intended to hold, as well as proposals to modify existing caused by the creation of NESO.

The Department for Energy Security and Net Zero (DESNZ) and Office of Gas and Electricity Markets (Ofgem) (collectively referred to as "we") also consulted on the Direction that the Secretary of State proposes that will cause National Grid Electricity System Operator Limited's existing transmission licence to have effect as the ESO licence when NESO is designated as the ISOP.

We also consulted on modifications to the following licences which will be impacted by the designation of the ISOP:

• Electricity Transmission Standard Licence Conditions
• Electricity Generation Standard Licence Conditions
• Electricity Interconnector Standard Licence Conditions
• Electricity Supply Standard Licence Conditions
• Electricity Distribution Standard Licence Conditions
• Gas Transporter Standard Licence Conditions
• National Grid Electricity Transmission plc: Transmission Licence Special Conditions
• SP Transmission plc and Scottish Hydro Electric Transmission plc: Transmission Licence Special Conditions
• Electricity Distribution Licence Special Conditions (including additional changes to Scottish Hydro Electric Power Distribution plc's Special Conditions only)
• Smart Meter Communication Licence
• National Gas Transmission plc (NGT): Gas Transporter Licence (Part C) Special Conditions
• Gas Transporters to whom Standard Special Conditions Part D apply: Gas Transporter Licence Special Conditions
• Gas Transporter Standard Special Conditions (Part A)

This response document sets out our joint considerations of the stakeholder responses received to that consultation and the licence text for those licences listed above.

ote that these documents do not constitute a decision to grant (or treat as granted) the proposed licences and modifications to impacted licences. A final decision on the granting of licences and making the modifications to impacted licences is to be taken by the Secretary of State (SoS) in sequence with a wider set of decisions to establish NESO. Once this decision is taken it will set the date for 'Day 1' when NESO will be created.

Main document

Subsidiary documents