Ofgem yesterday (13 November) granted National Grid ESO with the ability to terminate projects holding up the transmission entry capacity (TEC) register.
In doing so, the currently “clogged” grid connection queue could be slightly eased, however more work must be done to fully solve the ongoing issue.
The new powers granted to ESO enables the organisation to proactively manage the connections process by terminating projects that “are not progressing against their project milestones”. This helps remove projects that are “clogging” the TEC register.
These were recently dubbed “phantom projects” by utility company Centrica, with these categorised as projects owned by developers that may not have land rights and have not applied for planning consent.
In a recent report released by Centrica, the organisation indicated that, at present, around 62GW of projects – one fifth of all power in the queue – classify as a phantom. To solve this, Centrica called upon Ofgem to grant ESO the power to remove projects from the existing queue, something that as of yesterday has been granted.
Alongside its new powers, National Grid ESO also announced that it has commissioned an independent engineering consultancy DNV to inspect 144 “potentially high-risk” projects, which currently account for roughly 29GW of capacity, and have connection dates before the end of 2025.
Ofgem recognises the importance of the new measures and emphasised the need to remove stalled projects from the queue to ensure others can be accelerated.
Eleanor Warburton, Ofgem’s deputy director for Institutions for Net Zero Energy Systems Management and Security said: “The transition to net zero demands urgent changes to the electricity connections system – or we cannot unlock investment, speed up network build and accelerate new technology.
“This is a big step towards phasing out the first-come first-served queuing system. We want new power on the grid as quickly as possible, so if you’re ready, you can connect sooner. If you’re not ready and are blocking the progress of others, you’ll be removed – you can’t sit on the queue with no consequences.”
National Grid ESO “warmly welcomed” the new rules and stated that it marks a “milestone moment” in the organisation’s efforts in transforming the grid connections process.
“We warmly welcome these new rules approved by Ofgem enabling us to proactively terminate zombie projects in the connections queue. This is a milestone moment in the ESO’s efforts to lead the transformation of the grid connections process, making it fit for purpose for a modern network that is rapidly evolving and decarbonising,” said Julian Leslie, chief engineer and head of networks at the ESO.
“The ESO will be uncompromising in our approach to driving out projects that cannot meet their connection date, paving the way for more viable projects that have a real chance of plugging into the grid, energising the UK economy.”
It is worth noting that both Ofgem and the Department for Net Zero and Energy Security (DESNZ) are due to release a “joint connections action plan” later this month.
New grid connection rules are a step in the right direction
The string of announcements has been welcomed by much of the energy industry, with many recognising the tangible efforts being made in trying to solve GB’s grid connection woes. However, many noted that this is just a step in the right direction and more must be done to fully solve the issue.
This perhaps can be recognised in the response the Energy Networks Association (ENA) provided to the news.
“Today’s announcement from Ofgem is a significant milestone in accelerating and improving grid connections. While there’s plenty of work still to do, this is welcome news and we will continue to work with Ofgem and the government, as well as across our membership, to make progress on this and other major areas of reform,” said David Boyer, director of Electricity Systems at the ENA.
Echoing these thoughts, Regen chief executive Merlin Hyman believes that the new powers and grid connection process is welcome, but it must be integrated by National Grid ESO in a way that is “fair and transparent”.
“Regen wrote to the Secretary of State a year ago calling for action to unblock the queue of renewable generation and storage projects seeking a grid connection,” Hymann said.
“We, therefore, welcome Ofgem’s announcement that projects will be required to meet milestones or risk losing their connection agreement. The National Grid ESO will need to ensure this process is implemented in a fair and transparent way.
“It is vital that government, the regulator, the ESO and the networks now keep up momentum to make the grid net zero-ready. In particular, Regen will continue to play an active role in developing a new grid connections approach, which we expect to be announced shortly by the ESO.”
Consulting firm Charles River Associates, who produced Centrica’s “phantom projects” report, also sees the positives in the new rules with the company’s vice-president, Simon Ede, believing that the new arrangements allow for “more active management of connections”.
“The decision by Ofgem to fundamentally reform the queue for connections to the electricity grid is a sensible one. The current system was designed for a world with a small number of large fossil fuel generators connecting each year. That is now long gone,” said Ede.
“The first-come-first-served arrangements have led a rapid proliferation of renewable energy projects, but the existing queue has become oversubscribed by a factor of 3-4 compared to what industry believes is needed, with many projects in the current queue unlikely to ever come to fruition.
“As highlighted in our recent public report for Centrica, the situation has become significantly worse in the last few years and is now frustrating the UK’s net zero ambitions. The new arrangements allow for more active management of connections, shorten the amount of time it takes to connect viable projects, and accelerate decarbonisation of the electricity system.”
