GB grid connection crisis 2: National Grid ESO

This is the second in a series of posts about one of the key issues in current GB energy and climate policy: the problems associated with connecting to the electricity grid. The first post, setting out the background to the crisis, is here.

Connections reform took centre stage in a string of government announcements about energy and infrastructure topics in the Chancellor’s Autumn Statement of 22 November 2023. We will cover the connections-related announcements made by the government and Ofgem alongside the Autumn Statement (see further here, here and here) later in this series. In this post, we focus on some key steps that National Grid ESO (NG ESO) took during 2023 to remedy the connections crisis.

Ofgem’s open letter

No single entity can solve the problem of grid connections, but Ofgem has a key role to play. It regulates NG ESO, the owners of the transmission networks, and the distribution network operators (DNOs); it controls in large measure what they can invest through its regulation of network charges; and in most cases it determines whether proposed modifications to industry codes are made. The crisis in connections has featured prominently in recent speeches by Ofgem’s CEO, Jonathan Brearley (such as here).

On 16 May 2023, Ofgem published an open letter on future reform to the electricity connections process. It provides a good starting point for considering the ways in which the systemic problem of grid connection is being addressed. Figure 2 of that letter, reproduced below, gives a useful overview.

Ofgem emphasises that any move towards the more radical approaches of Stages 3 and 4 will “depend on the effectiveness of the earlier stages in meeting the outcomes”. It also sets out and elaborates some key principles that will guide its approach.

Reforms must deliver benefits to current and future consumers, as well as accelerating progress towards net zero. They must begin to deliver results as soon as possible, with impacts seen by 2025. They must support improved coordination across onshore/offshore and transmission/distribution networks. They must also be resilient to the impacts of the various wider-ranging energy market and system planning reforms playing out over the remainder of this decade (including the Review of Electricity Market Arrangements (REMA) and introduction of a Future System Operator (FSO), which, as Electricity System Operator, will take over the current roles of NG ESO).

The open letter is a useful recapitulation of action already being taken by Ofgem, such as the “c.£20 billion” Accelerated Strategic Transmission Investment or ASTI framework (see further here), and of possible agenda items for the future (such as “options which could deprioritise projects which are not making progress to allow well-developed projects to proceed“). In this document, at least, the regulator only seems to be systematically promoting “anticipatory investment” (i.e. building ahead of need) in the context of offshore generation projects (see further here).

NG ESO’s short-term actions: the Five-Point Plan

Some of the Stage 1 steps in Ofgem’s graphic feature in NG ESO’s February 2023 Five-Point Plan.

Modelling: how big is the queue (really)?

“Background modelling assumptions” may not sound terribly exciting, but they play a crucial role in the connection process. In order to be robustly connected to the network, each generating project may require “wider works”, not just the construction of infrastructure in their immediate vicinity. The current list of transmission reinforcement schemes required to facilitate network connections runs to well over 4,000 projects, most with delivery dates in the late 2020s or early 2030s.

The need for and phasing of wider works can have a significant impact on a project’s connection date. Both inevitably depend in part on what work is required to accommodate other projects that are seeking to connect. Elsewhere, NG ESO has pointed out that 42% of new applications for connection made between 2018 and 2021 had “fallen out of the process” by December 2022, and it has been estimated that as much as 30-40% of capacity in the current transmission queue may not be ready to connect on its scheduled connection date (if it is built at all).

Clearly, if an appropriate way can be found of taking account of the level of “attrition” in the connections queue, it may be possible to accelerate the connection of some projects.

NG ESO is therefore “working with GB’s Transmission Owners to review and update existing contracts with…new Construction Planning Assumptions“. It should be possible to manage these changes through existing System Operator-Transmission Owner Code and Connection and Use of System Code (CUSC) procedures. NG ESO states that implementation will require a “complete system review of the GB Transmission Reinforcement Works…for all contracted offers with a connection date post 1 January 2026“, at the end of which “some contracted parties within the GB transmission system queue…could have their connection date moved forward“.

The current estimate is that 46GW of projects could accelerate their connection dates as a result.

These modelling changes (and those specifically relating to storage – see below) are feeding into a “complete system review” of Transmission Reinforcement Works (TRW) for all projects with a connection date after 1 January 2026. This will “rationalise the TRW required” and identify options for battery projects to connect earlier with interim restrictions (see below).

Leslie Alexander

Solar energy service

Leslie Alexander is a distinguished Solar Energy Specialist at the forefront of the renewable energy revolution. With a passion for sustainable technology and a commitment to addressing the global energy crisis, Leslie has dedicated her career to advancing the field of solar energy.