Ofgem publishes interim RRP and PCFM guidance for gas distribution under RIIO-3, with full templates due July 2027

Ofgem has published the finalised interim Regulatory Reporting Pack (RRP) and associated Price Control Financial Model (PCFM) guidance for gas distribution network operators under the RIIO-3 price control, which took effect on 1 April 2026^[1]. The documents give the four gas distribution networks - Cadent, Northern Gas Networks, SGN, and Wales & West Utilities - the templates they need to submit revenue data for this year's Annual Iteration Process (AIP), the mechanism through which Allowed Revenue is updated annually^[1].

Why an interim pack, not a full one

The interim RRP covers only the revenue sheets of what will eventually be a comprehensive reporting template. Ofgem acknowledged that wider work on the full RIIO-3 RRPs was unlikely to be completed in time for the AIP this year, so it consulted separately on the revenue subset to ensure a published template was available for licensees in time.

These interim RRPs will subsequently be incorporated into the full RRPs ahead of the reporting submission due in July 2027, relating to the 2026-27 reporting year. The approach mirrors how Ofgem handled the equivalent transition at the start of RIIO-2.

What the PCFM guidance does

The PCFM is the financial model that translates reported data into Allowed Revenue for each network. The reporting framework enables Ofgem to collect accurate and consistent cost, volume, allowed expenditure, and output delivery information from Gas Distribution Networks (GDNs), and allows GDNs to complete the reporting requirements associated with updating variable values and performance data in the PCFM during the AIP, which in turn drives Allowed Revenue.

The main licence condition underpinning the obligation is Standard Condition A40: Regulatory Instructions and Guidance of the GDN Licence^[1].

The RIIO-3 context

RIIO-3 runs from 1 April 2026 to 31 March 2031, replacing RIIO-2 which expired on 31 March 2026. Under the framework, Ofgem approved £28.1 billion of upfront funding for investment, within a wider investment pipeline of around £90 billion over the RIIO-3 period.

The interim RRP publication is one of three sector-specific decisions released in parallel:

• Gas distribution (RIIO-GD3) - Cadent, Northern Gas Networks, SGN, Wales & West Utilities^[1]
• Gas transmission (RIIO-GT3) - National Gas Transmission^[3]
• Electricity transmission (RIIO-ET3) - National Grid Electricity Transmission, Scottish Power Transmission, Scottish Hydro Electric Transmission^[2]

These materials align with the new RIIO-3 licence conditions that took effect from 1 April 2026.

What to watch

The immediate deadline for gas distribution networks is to use the interim revenue templates to complete this year's AIP submissions. The fuller picture - covering cost, volume, and output reporting - will follow when Ofgem finalises the complete RIIO-GD3 RRPs, with the first full submission window opening ahead of July 2027. A parallel draft gas distribution reporting and guidance consultation, covering the broader Regulatory Instructions and Guidance (RIGs) document, closed for responses on 25 August 2026, suggesting the complete framework is on track to be settled well before that deadline.