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MPs Warn of Connection Delays and Market Uncertainty Hampering Grid Decarbonisation Plans

Ahead of the end of Parliament, the Environmental Audit Committee (EAC) has urged the next government to publish a detailed grid electrification strategy swiftly.

Last week, MPs highlighted the substantial challenges facing the next government in its goal to decarbonize the electricity grid. They warned that the transition to clean power is being hindered by slow grid connections, limited capacity, outdated planning regulations, and market uncertainties.

Before Parliament adjourned for the election campaign on Friday, the EAC released a new report on Great Britain's electrification. The report noted that although there is enough clean power capacity in the pipeline to meet the current government's target of a clean power system by 2035, progress is being stalled by grid capacity issues and lengthy planning delays.

The report calls on the incoming government, post-July 4 General Election, to collaborate with Ofgem and the National Energy System Operator to create a "detailed pathway" and a grid decarbonization delivery plan before the end of the year.

Decarbonizing the grid is likely a significant election issue, given the stark contrast between the main parties' approaches. Labour aims to achieve a clean power system by 2030—five years ahead of current plans—and proposes reforming the planning system and introducing Great British Energy to meet this target. In contrast, the government argues that this accelerated timeline is unrealistic and would increase energy bills and taxes.

Energy industry experts believe decarbonizing the grid by 2030 is technically feasible but would require rapid reforms to implement a massive wave of renewables projects, grid upgrades, and energy efficiency improvements.

The EAC emphasized that regardless of the next government, a detailed plan is urgently needed to outline the necessary investment and infrastructure for electricity decarbonization goals. Achieving the 2035 target will require a fivefold increase in offshore wind and solar capacity and a more significant role for nuclear energy in the UK's electricity mix.

The inquiry revealed that the queue for new grid connections now exceeds twice the capacity needed to meet the 2035 decarbonization target. Although Ofgem and the Electricity System Operator have initiated reforms to reduce grid connection times, the effects are not expected until later this year. Therefore, the report recommends that further reforms to the connection regime remain a priority for the next government, with Ofgem monitoring and publicly reporting monthly on the queue's status.

The report also highlighted that the required level of energy storage for the UK's future energy system is unclear, with varying forecasts depending on models and data used. The lack of clarity on the type of energy storage needed is inhibiting private investment and slowing the rollout of new projects.

The EAC recommended that the next government analyze the necessary levels and types of short-term and long-term energy storage required for a net zero energy system by the end of 2025.

MPs also stressed the need for increased adoption of clean technologies to create a more efficient, locally responsive, flexible grid, which could reduce costs by up to £10 billion annually by 2050.

Further recommendations include creating guidance for operators and local authorities on best practices for community engagement, new incentives to ensure essential elements of the electricity infrastructure supply chains are based in the UK, and a plan to ensure sufficient staffing for planning authorities.

Additionally, the EAC reiterated its 2021 call for the government to define 'a green job' and outline how it will measure progress toward its green jobs target.

"The UK government has committed to transitioning the economy to a fully decarbonised electricity system by 2035, supported by targets on the deployment of solar, wind, hydrogen and smart meters among others," the report's summary explained. "For the UK to deliver on its sustainable electrification target for the GB grid, energy generation, flexibility, and storage must increase alongside network infrastructure.

"As the UK drives towards net zero, electricity demand is expected to dramatically increase, and the transmission and distribution network must develop and expand alongside the growth in supply and demand."

The report's release coincided with National Grid launching a £7 billion capital raise to fund a significant program of electricity network upgrades aimed at preparing the grid for the accelerating rollout of renewables and clean technologies.

National Grid announced that the new funds would support a significant £60 billion investment program to upgrade and expand electricity networks over the next five years.

The report's release also aligned with the start of Labour and Conservative campaigns for the surprise General Election on July 4, with both parties trading barbs on energy policy.

Energy Secretary Claire Coutinho reiterated warnings that Labour's ambitious plans to decarbonize the grid by 2030 could increase energy costs. In contrast, Labour criticized the government for celebrating a modest reduction in the energy price cap, which still left average annual bills £400 above pre-pandemic levels.


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