“There will be a RIIO 2, and it will have an ex-ante incentive-based output-led approach,” Ofgem chief engineer Peter Bingham told the iGEM annual conference. But, he said, “make no mistake, price controls will get tougher” – although the regulator would still have to ensure the industry was attractive for investors.

Bingham said there have been “genuine efficiency improvements” at companies but that their high returns had also been “a function of the changing environment since 2012 [when RIIO 1 began]”. Some has been the result of overstated allowances.