Ofgem approves GB electricity grid connection reform

Energy projects expert Ronan Lambe of Pinsent Masons described the announcement as “the firing of the starting gun for the Gate 2 to Whole Queue reforms” – reform of the existing connection queue as proposed in December 2024 by the National Energy System Operator (NESO), the body which oversees connections to the electricity grid in Great Britain.

“The energy industry will broadly welcome Ofgem’s decision on NESO’s connections reform package, as it means the goalposts have finally stopped moving on this vital topic,” he said.

“As the associated licence, code and methodology changes involve a 56-day standstill period from the date of Ofgem’s decision, with an additional four-week notice period also mandated by the CUSC [Connection and Use of System Code], it is now expected that the Gate 2 to Whole Queue evidence window will open for distribution connections in May 2025 and for transmission connections in early July 2025. The certainty as to when the window for evidence submission will start and the fact that projects should start to hear whether their Gate 2 applications have been successful or not from September 2025 will prove valuable to developers keen to take other key commercial decisions with respect to the development of their projects,” he said.

The current grid connections process has long been a bottleneck for new energy generation and demand projects. The existing system has been considered ill-equipped by the industry to handle the surge in clean energy projects essential for meeting the country’s decarbonising goals.

The reform plan includes several critical changes aimed at making the grid connections process more agile and efficient, with a particular focus on those that align with the UK’s strategic energy goals and Clean Power 2030 Action Plan.

Planning and environment law expert Matt Fox of Pinsent Masons said: “With only some exceptions, the latest announcement confirms that the Clean 2030 Action Plan capacities are key ‘strategic alignment’ criteria to get into the queue. This will increase the importance of those capacities in framing a need case for your project, particularly in the context that objectors are likely to point to other projects ‘taking up’ those capacities to say that there is no need for your project.”

By expediting the development of clean energy projects and accelerating access to connection capacity for industries with large demands for electricity – such as data centres and hydrogen production – the initiatives aim to attract significant investment, generate employment opportunities, and stimulate local economies. The government estimates that these changes could unlock £40 billion of mainly private investment annually and drive growth.

The reforms are part of the government’s broader ‘Plan for Change’, which aims to reshape the economy in response to global uncertainties. By prioritising grid connections for businesses that will deliver clean energy, the government hopes to position Britain as a leader in the global clean energy market.

However, reforming the grid connections process is not without challenges. Fox said: “Given the plan’s requirements for land rights in the ‘readiness criteria’, we can expect a lot of busy work in the real estate space as promoters and landowners frantically try and complete options by the submission window, specifically the submission window for distribution connecting projects which opens in May, with transmission ‘expected’ for July.”

Additionally, Fox highlighted the unclear planning criteria. He said: “The planning criteria do not seem to take into account the vagaries of the Planning Act 2008 process, not least that development consent orders are not ‘validated’, and that a project gets a planning reference number once a scoping report is submitted. However, by implication it would appear that the criteria is that your development consent order application needs to have been ‘accepted’.”