National Grid to pay energy customers £200m over next two years after trading electricity with Europe
National Grid will share some of the excess cash it has made from electricity cables to Europe ahead of schedule as regulator Ofgem and others try to help keep bills pushed down.
The grid operator said it will pay £200 million to consumers over the next two years - the balance is normally settled every five years, but an unprecedented crisis in the energy markets meant the company and Ofgem thought it wise to make the payments earlier.
National Grid is not allowed to make more than a certain amount of money from its cables, so excess has to be paid back to consumers.
Jonathan Brearley, the chief executive of Ofgem, said: “This early payment of £200 million ensures consumers get value for money sooner from our regulatory framework.
"Our regulatory approach for interconnectors not only protects the interests of consumers, but it also promotes new investment in affordable, modern energy infrastructure."
He added: "We're now working at pace to ensure this money is returned to the consumer in the fastest and most impactful way."
National Grid boss, John Pettigrew, said: “While National Grid's impact on customer bills is relatively small, we strive every day to keep our costs as low as possible.
"Given how challenging the current rise in overall energy costs is for people across the country, we want to play our part in helping reduce consumer bills."
The cash comes from cables that connect France, Belgium and Norway with the British power grid.
It means that when French electricity generators produce more than their customers can use, they can sell their excess to households in Britain.
Meanwhile, when British wind turbines spin more than British households have use for, that gets sold back to the French.