Prime Minister Andy Burnham's latest announcement for the creation of Great British Grid seeks to address the transmission capacity shortcomings currently facing the grid.
In 2024, the National Energy System Operator introduced reforms to the grid connection process in an attempt to clear queues caused by inactive projects. The first come first served model was replaced but this did not solve one of the key issues facing the grid – the insufficient capacity to keep pace with the rapidly-increasing supply of renewable electricity generation.
This is expected to become increasingly challenging in a post-2030 world, especially in conjunction with how commitments in the Strategic Spatial Energy Planning plan will be delivered across Great Britain.
The prime minister did not announce what funding would be available to this new arm of Great British Energy, the state-owned energy company, but reports indicate it could be in the region of £4 billion. The government has confirmed that any initial start-up costs will be covered by Great British Energy’s existing budget, with a long-term budget for the expansion of Great British Energy to be considered as part of future spending reviews.
While the reported £4 billion Great British Grid fund may facilitate investment into the transmission network, with the aim of developing increased connection speeds and driving competition in the sector, this sum is a relatively modest investment compared to the £70 billion planned by National Grid over the next five years.
A follow-up press release by the government confirmed:
Great British Grid will work alongside existing network operators, rather than replace them;
the government will bring forward reforms to expand self-build connections, allowing developers and businesses to build their own connections where appropriate instead of waiting for network companies as the current system requires in most cases - with similar reforms in Ireland reducing connection times by up to 11 months; and
the acceleration of competitive tendering of transmission projects, allowing a wider range of organisations including Great British Grid to compete to deliver new network infrastructure .
The ability for developers to conduct connection works themselves may incentivise greater investment decisions. The rationale being that these works could result in reduced costs and accelerated build and connection programmes by not obliging developers to procure works from the existing network companies. Time will tell once the proposed reforms to this system are introduced to what extent they will allow for self-built connections to the grid.
While a step in the right direction, tackling transmission network capacity shortfalls alone will not solve the issues facing the energy sector. Increased investment in long-duration energy storage systems, a focus for Great British Energy, is one example that would go a long way towards mitigating the curtailment currently experienced by renewable projects during excess generation periods, ready for usage during lower generation periods.
The prime minister’s announcement is welcomed for the sector, but further information is needed to bolster these proposals, including what the funding will target and how, before there can be an assessment of how successful this new venture may prove to be.
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