UK Power Grid Requires $60 Billion Investment by 2050 | OilPrice.com
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Breaking News:
The UK could need up to $63 billion of investment in the power distribution network nationally to support additional demand and generation through 2050, double the current pace of additional investment, said the National Infrastructure Commission, the government’s independent infrastructure advisor.
The UK will likely need investments of between $47 billion (£37 billion) and $63 billion (£50 billion) by 2050 as a “step change” is required in investment in Great Britain’s local electricity networks. This investment would be essential to achieve the government’s growth mission and lower long-term energy costs for consumers, the commission said in a report on Friday.
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The required investment levels would be at least a doubling of current annual allowances for load related expenditure, on top of business as usual investment, such as end of life asset replacement, the commission added.
The National Infrastructure Commission’s report says that with demand for electricity set to double by 2050, the current pace of additional investment in electricity distribution networks must also double to ensure the system can cope with rising demand and connect both new sources of renewable power and new electricity demands to the grid faster.
Investments, however, are constrained by legislation. Current regulation by the energy regulator Ofgem “is too complex and doesn’t encourage distribution network operators (DNOs) to make the proactive investments needed to boost network capacity and provide resilience to future climate impacts,” the commission’s analysis found.
In the report, the government’s infrastructure advisor calls for “a more proactive approach to both energy regulation and system planning.”
Ofgem is currently seeking feedback on proposed changes to the grid connection policy from a first-come first-served approach to prioritizing projects where generation capacity is needed the most and projects are at a more advanced stage of development. The regulator looks to reform the current connections regulation which has become inadequate as some early-queued projects have fallen behind schedule while more advanced projects are waiting for years to connect to the grid.
By Tsvetana Paraskova for Oilprice.com
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