UK energy regulator Ofgem has provisionally approved a £24 billion ($32.98 billion) investment plan aimed at modernizing the country’s electricity and gas infrastructure.
The initiative supports Britain’s goal of decarbonizing its power sector by 2030, which demands increased use of renewable sources like wind and solar. To accommodate this shift, the energy grid requires significant upgrades.
“This record investment will deliver a homegrown energy system that is better for Britain and better for customers,” said Ofgem CEO Jonathan Brearley. “It will also strengthen our resilience to volatile global gas prices.”
The funding will support 80 transmission projects, including £15 billion for gas network improvements and £8.9 billion for expanding the electricity grid.
Under UK rules, energy network companies submit investment proposals for Ofgem's approval, including cost estimates and expected returns. These costs are recouped through network charges, which currently account for about 25% of a typical household energy bill.
Ofgem estimates that after factoring in savings, the upgrade will add roughly £24 per year to the average household bill by March 2031.
Major energy firms involved in the UK's infrastructure include SSE, National Grid, and Scottish Power (owned by Iberdrola). Photo by Robin Webster, Wikimedia commons.