NGG National Grid Plc New

By Tapan Panchal

LONDON--The Office of Gas and Electricity Markets said Friday that it will propose reducing National Grid PLC's (NG.LN) allowance for its gas transmission price control by 277.5 million pounds ($345.58 million).

The funding is for providing capacity by putting gas into the national high-pressure gas pipeline at the Fleetwood entry point in Lancashire, England, the energy regulator said, adding that the gas shipper that bid for the capacity at an auction has defaulted on payments and no longer has a right to the capacity.

Ofgem said it is proposing to reduce the allowance to avoid customers being charged for investment that hasn't been delivered.

The regulator is also consulting on removing National Grid's obligation to provide capacity at Fleetwood, meaning any gas shipper wanting to buy capacity would have to purchase a minimum amount in one of the regular National Grid auctions.

Ofgem expects to make a final decision on the funding allowances and National Grid's capacity obligation in the summer of 2017.

-Write to Tapan Panchal at tapan.panchal@wsj.com

(END) Dow Jones Newswires

March 31, 2017 02:35 ET (06:35 GMT)

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