It’s an open secret in the energy industry that “the great grid upgrade” – the £70bn programme to rewire the nation’s electricity transmission network to enable clean power by 2030 – is running over budget and behind schedule, and may end up costing consumers and businesses more in their bills than advertised. It is impossible to get straight answers from the bodies overseeing the massive spending programme, which may continue at an even greater scale into the 2030s. The Department for Energy Security and Net Zero (Desnz), its in-house body, the National Energy System Operator (Neso), and Ofgem, the supposedly independent regulator, publish acres of information on narrow matters, but none provides a clear big-picture assessment: how is the grid upgrade really going?
Thank goodness, then, for Friday’s National Audit Office (NAO) report. The watchdog has unearthed a few hard statistics and demanded far greater official transparency. Prime minister Andy Burnham, in cost-of-living mode, should take note: trouble is brewing.
Of the 88 grid upgrade projects originally identified, 12 have already been completed (good news) and 12 have been subsumed into newer work (fair enough). But of the 56 deemed “essential” for meeting the government’s target of clean power by 2030, the NAO says 50 are “forecast to be delivered after their optimal date”. Of those, only 22 are forecast to be less than a year late; the rest are further behind schedule, with one put at between six and seven years behind.
The “optimal” date, in this context, is the date required not only to fulfil the 2030 clean power deadline but also to keep a lid on the maddening “constraint costs” – payments to Scottish windfarms to turn off when the grid can’t handle their output, plus payments to southern gas-fired generators or interconnecters to France to start supplying electricity. On one windy day alone this week, such constraint payments reached £29m. The tally for the whole of 2026 is virtually guaranteed to top £2bn.
The big worry is that the upper end of Neso’s forecast for 2030 – a colossal £7.8bn, all going on bills – might be realised if the delays worsen. Therein lies the reason why a grid upgrade is needed in the first place: the transmission network suffered from a lack of investment, even before the switch to renewables started. The transition makes the work more urgent.
But what is also revealed is a state failure, going back decades, to expand the grid to keep pace with additional generating capacity. The suspicion now is that the same mistake is being repeated. Many construction delays can be explained, it should be said.
Extract — continue reading at the source.
