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Network Innovation Allowance Annual Report

All Energy Networks will produce an Annual Innovation Report for each regulatory year which meets the minimum requirements set out in Ofgem Network Innovation Allowance (NIA) Governance Document.This report contains a summary of all our NIA activity within the period from 1 April 2022 to 31 March 2023 for the four licence areas of National Grid Electricity Distribution: South West, South Wales, East and West Midlands. This report has been produced in accordance with the Regulatory Instructions and Guidance (RIGs) issued by Ofgem. You can download the report here: Network Innovation Allowance (NIA) Annual Report 2023

In addition, an ENA industry wide Annual Innovation Report is also published by the end of October each year. A copy of the latest version can be found on the Smarter Energy Networks Portal here.

National Grid is continuing to deliver a wide portfolio of low carbon projects through the Network Innovation Allowance to bring significant benefits to our customers via a timely and agile process which is responsive to new developments.

We also support other research, development and demonstration projects, which fall outside the scope of the innovation mechanisms. We continue developing commercial models and technical solutions that facilitate customer choice in a cost effective way, whilst at the same time managing the impact on the networks.

We have a number of projects which have produced significant learning. Active Creosote Extraction (ACE), is an environmental focused innovation project which is trialling a new method to remove creosote from wood poles resulting in significant carbon emissions savings and taking a significant step to net zero. Also, we have generated significant learning from Smart Meter Innovations and Test Network (SMITN) on how we can use smart meter data to help populate missing data, or find incorrect data relating to our Low Voltage (LV) Network. This includes identifying the particular LV feeder and phase to which a customer is connected and whether photovoltaic panels are present at a property.

We remain committed to continuing and increasing our third party involvement within our innovation programme, to enable project outcomes to be taken through to business as usual quickly and effectively. We welcome Ofgem’s decision to retain innovation funding in the form of the NIA for the first three years of RIIO-ED2 and look forward to clarity on the arrangements for the remainder of the ED2 period.