Ofgem publishes BP3 performance assessment of NESO, flags connections reform and value-for-money gaps

Ofgem published its assessment of NESO's performance under Business Plan 3 (BP3), covering April 2025 to March 2026, concluding NESO met expectations overall with seven of eight performance objectives delivered or on track, while identifying connections reform progress and demonstrating value for money as areas requiring further improvement.

As the independent System Operator responsible for operating the electricity system and supporting electricity market change, NESO's regulatory accountability directly affects the pace and credibility of connections reform and broader market design initiatives; Ofgem's critical findings on value-for-money and connections progress may shape future regulatory scrutiny, NESO resourcing priorities, and stakeholder confidence in NESO-led market design processes.

This is an institutional accountability event rather than a concrete market mechanism change, but it carries indirect design relevance: connections reform is a foundational input to capacity/adequacy and flexibility market functioning in GB, and Ofgem's public criticism increases pressure on NESO to accelerate that reform and to better justify costs passed through to market participants via NESO-administered processes (e.g., balancing, CUSC, Grid Code work). No specific rule, methodology, or code change is introduced by this source; it functions as a signal that could precede future proposals or governance changes affecting connections queue management and NESO cost recovery, but those are not yet specified.

Ofgem Business Plan 3 (BP3) performance assessment framework for NESO

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