UK Greenlights £24bn Energy Infrastructure Investment to Strengthen Grid and Clean Power Transition

UK energy regulator Ofgem has given provisional approval for a £24 billion (approximately $32 billion) investment programme aimed at enhancing Great Britain’s energy infrastructure, reinforcing energy security, and accelerating the shift to renewable energy sources.

This initial commitment forms part of a broader strategy that could reach £80 billion in total funding, intended to upgrade and expand the nation’s electricity networks. The objective is to insulate British consumers from the volatility of global gas markets and modernise the energy system for a net-zero future.

From the £24 billion allocation:

• £15 billion will be allocated to ensure the continued safe and reliable operation of the gas transmission and distribution networks, supporting energy needs for households and businesses.

• £8.9 billion is earmarked for upgrading high-voltage electricity infrastructure, with an additional £1.3 billion set aside for potential future projects.

  
  

The planned improvements include:

• Over 4,400 km of upgraded overhead lines

• 3,500 km of new power circuits, effectively doubling offshore investments compared to the previous decade.

By 2030, these upgrades aim to enable the connection of up to 126 GW of renewable energy capacity, including advanced storage systems to improve grid flexibility and reliability.

Ofgem has conducted a six-month rigorous review of spending proposals from electricity transmission and gas distribution companies. As a result, more than £8 billion (26%) was cut from initial bids that were deemed not cost-efficient for consumers.

According to Ofgem, the anticipated impact on household energy bills by 2031 will be around £104 due to higher network charges. However, about £52 of that total is directly tied to grid expansion to support growing electrification, while the remaining £52 is needed to maintain safety and service levels across both gas and electricity networks.

Jonathan Brearley, CEO of Ofgem, commented:

“Britain’s dependency on imported gas has exposed us to wild price swings. During the energy crisis, household bills could have reached £4,000 without government support. Even now, price caps can fluctuate by hundreds of pounds at a time. These 80 infrastructure projects serve as a long-term safeguard for the UK’s energy security and price stability.

By integrating more homegrown renewable power and transforming our grid into a modern system, we can boost economic growth and gain greater control over energy pricing. But this progress must be made responsibly. That’s why we’ve incorporated strict cost controls and negotiated fair terms for both investors and consumers. We stand ready to act if any network operators fail to meet their deadlines or budgets.”