UK government clean energy plan provides clarity and will accelerate projects

The plan (138 pages/6.1 MB) sets out to get more homegrown clean power connected to the grid by building the necessary infrastructure, prioritising projects needed to revolutionise the country’s ecosystem to achieve 95% clean energy by 2030. The plan is seen as a crucial step towards achieving the UK’s net zero targets and ensuring long-term energy security.

Over the last five years, the grid connection queue has grown tenfold, and now contains an equivalent capacity of 739 gigawatts (GW). Many of these projects are very early-stage, some are speculative, and a large number do not yet have the necessary funding or planning permission to progress. The queue is currently managed on a “first come, first served” basis.

However, “to meet the 2030 ambition, action is needed now to rationalise the queue and accelerate the projects that are critical to the goal”, said Mark Ferguson, public affairs and sustainability expert at Pinsent Masons.

“This means going beyond previous plans to deprioritise slow-moving or stalled projects and prioritise based on readiness alone. Cleaning up the queue will allow for critical infrastructure from housing to gigafactories and data centres to get connection to the grid, helping to unlock billions of investment and grow the economy,” said Ferguson.

The plan will provide clarity on what the energy mix will look like for 2030 on a national and regional level, including updates to the national policy statements for energy that guide planners, setting out clear direction on the importance of delivering the right amounts of clean power and energy infrastructure for 2030.

The plan confirms the government’s acceptance of the view by the National Energy System Operator (NESO) that some 80 of the transmission upgrade projects identified in its Pathway to 2030 Report must be delivered by 2030, with a subset of these needing to be accelerated. “Facilitating the deployment of these projects, accelerating them as necessary and ensuring that sufficient funding is made available through Ofgem’s price control mechanism will be key to achieving the 2030 target,” said Ronan Lambe, energy law expert at Pinsent Masons.

The government is also bringing onshore wind back into the Nationally Significant Infrastructure Project (NSIP) regime in England in a bid to make it easier to progress onshore farms larger than 100 megawatts (MW). The government has pledged to take forward a Planning and Infrastructure Bill with measures to streamline the delivery of critical infrastructure in the planning process. It is also working to ensure communities directly benefit from hosting clean energy infrastructure.

Further reforms to accelerate homegrown clean power include expanding the renewable auction process so projects can get funding agreed before their planning permission has been finalised. This move aims to stop delays and get more projects online. Plans to unlock investment into supply chains, allocating funding from the clean industry bonus, and ensuring clear power creates jobs across the country have also been set out.

Additional pro-consumer reforms aim to help households have more choice and access to cheaper energy tariffs, ensuring more consumers can make the choice to save money on their bills by using appliances when electricity is cheaper. For example, charging their car overnight and selling excess energy back to the grid.

The plan also confirms the government’s intentions to conclude policy development around the review of electricity market arrangements (REMA) programme by mid-2025, with the timetable for REMA decisions to align with the timetable for the seventh CfD allocation round.

“From an investment certainty perspective, this clarity is welcome,” said Lambe.

“The sooner that investors in electricity generation projects gain clarity on the government’s plans around hugely significant potential market changes such as the introduction of zonal pricing, the better. The 2030 ambition will not be reached where fundamental market changes such as those contemplated by REMA remain a spectre for those looking to finance the new generation projects required to achieve a generation mix which is 95% ‘clean’.”