UK gas distribution firm Cadent has agreed to refund £54 million in allowances to Ofgem.
Formerly called National Grid Gas Distribution, Cadent owns the gas distribution networks in North London, Central England, the East of England and North West England.
It offered to waive the allowances for some investment it will no longer be making in its Central London gas network during the current price control.
Ofgem sets price controls for Britain’s energy network companies and following a review on Cadent’s offer, the regulator has decided to reduce the allowance for its 2013-2021 price control.
It is in addition to the £185 million reduction in National Grid’s allowance for running the electricity grid and gas main.
Cadent said it recognises it is “not practical” to renew the full 69 kilometres of medium pressure gas mains by 2021.
A spokesperson added: “We believe it is right that consumers should be refunded now rather than at the end of this price control period in four years’ time. Safety remains our top priority. We will continue to maintain all our gas mains and to repair or renew them as necessary.”