Ofgem said it has received written notification from National Grid revealing the company to be in “early stages of discussions” on the details of the sale of four of the country’s eight gas distribution networks, serving 10.9 million consumers in the UK.
Ofgem said National Grid will require its consent to transfer assets outside of its operational control, most likely into a subsidiary company also held by National Grid, and for the transfer of the gas distribution licence.
The regulator said the sale may also require the modification of the gas transmission licence held by National Grid and said it “expects to receive these requests shortly”.
The sale process is expected to start this spring and complete early next year.
Canadian pension funds Ontario Teachers’ Pension Plan (OTPP) and Borealis have been tipped along with SSE as potential buyers. The three companies bought the SGN gas distribution business from National Grid in 2004.