Ofgem will invest just over £10bn the British electricity grid over the next five years.
Electricity grid expansion is expected to reduce bills by £50 by 2031, thanks to lower reliance on imported gas and the halting of constraint costs ensuring power flows efficiently from where it’s generated to where it’s needed, even at peak demand, Ofgem said in a release.
The funding announcement is part of a larger investment announced today by Ofgem, including £17.8bn for the maintenance of Britain’s gas networks.
The overall investment will rise to an estimated £90bn by 2031.
Ofgem CEO Jonathan Brearley (pictured) said: “The funding announced today will keep Britain’s energy network among the safest, most secure and resilient in the world.
“The investment will support the transition to new forms of energy and support new industrial customers to help drive economic growth and insulate us from volatile gas prices.”
“Ofgem will hold network companies accountable for delivering on time and on budget, and we make no apologies for the efficiency challenge we’re setting as the industry scales up investment,” the Ofgem boss added.
“We’ve built strong consumer protections into these contracts, meaning funds will only be released when needed and clawed back if not used.”
ScottishPower said it will invest up to £12bn in Central and Southern Scotland’s electricity transmission network.
SP Energy Networks will begin work to build 12 new major substations, upgrade 450km of existing circuits, reconduct 87km of overhead lines and replace 35km of underground cable between 2026 and 2031.
The company said it plans to double its workforce by recruiting 1,400 new roles directly and supporting a further 11,000 jobs across the country.
Nicola Connelly, CEO of SP Energy Networks, said: “We welcome Ofgem’s final determination recognising the need for this historic investment in critical network infrastructure.
“Our record investment of almost £12bn will unlock capacity in the grid and bring economic growth across our area of central and southern Scotland and beyond.”