Energy regulator for the UK, the Office of Gas & Electricity Markets (Ofgem), has granted initial approval to 80 energy projects to upgrade Britain’s electricity supergrid and maintain the gas infrastructure
Ofgem has given preliminary approval to an energy investment package that will unlock 80 new energy projects across the UK.
The draft settlement for RIIO-T3 (April 2026 to March 2031) begins an estimated £80bn investment programme boosting the country’s electricity network capacity, quadrupling current spending levels.
The investments include:
- Over £15bn for maintenance of gas transmission and distrubution networks
- An initial investment of £8.9bn for the high-voltage electricity network, with a further £1.3bn lined up
- Upgrading 4400km of overhead lines and deliver 3,500km of new circuits(including offshore)
- £4.2bn for National Grid, £3.1bn for Scottish & Southern Electricity Networks (SSEN) and £1.6bn for Scottish Power
These projects will double the total build in the last 10 years and up to 126 GW of clean power generation will be connected to the grid by 2030, alongside additional flexible storage and technologies.
The 80 new projects will help secure Britain’s energy security
Ofgem chief executive Jonathan Brearley said: “Britain’s reliance on imported gas has left us at the mercy of volatile international gas prices which during the energy crisis would have caused bills to rise as high as £4,000 for an average household without government support. Even today the price cap can move up or down by hundreds of pounds with little we can do about it.
“This record investment will deliver a homegrown energy system that is better for Britain and better for customers. It will ensure the system has greater resilience against shocks from volatile gas prices we don’t control.
“These 80 projects are a long-term insurance policy against threats to Britain’s energy security and the instability of prices. By bringing online dozens of homegrown, renewable generation sites and modernising our energy system to the one we will need in the future we can boost growth and give ourselves more control over prices too.
“Doing nothing is not an option and will cost consumers more – this is critical national infrastructure. The sooner we build the network we need, and invest to strengthen our resilience, the lower the cost for bill payers will be in the future.
Cost scrutiny has been extensive to ensure best value for billpayers
The news follows six months of cost scrutiny by the energy regulator, having studied the spending proposals from the electricity transmission owners, National Gas, and the gas distribution companies, to ensure value for billpayers. The process managed to cut over £8bn from company bids- roughly 26%- to maximise cost efficiency of the projects. Private investors were also subject to a 6% equity return cap.
The impact of the new energy projects is projected save around £30 on household energy bills- although bills are still predicted to rise by £104 by 2031.
“However, this can’t be done at any price,” Brearley continued, “which is why we have built in cost controls and negotiated a fair deal for both investors and consumers. And we won’t hesitate to intervene if network companies don’t deliver on time and on budget.”
However, some energy companies think Ofgem should have gone further and approve more investments. SSEN Transmission said: “Based on an initial assessment, Ofgem’s draft determination does not go far enough to deliver the investible, financeable and ambitious framework required to unlock the unprecedented levels of investment needed to deliver lower and more stable bills.”
The statement went on to say that Ofgem’s methodology “does not reflect the true, evidence-based costs that are required to develop, build and maintain a reliable electricity transmission network in the north of Scotland”.
The consultation on the draft determination have now been published, with the final decisions due at the end of this year.
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