Grid queue-busting regime ‘not tough enough’

The new regime for policing grid connection blockages is insufficiently tough with half of projects in the queue not due to be vetted for another four years, a renewable developer has said.

Under recently-introduced reforms approved by Ofgem, developers will have their grid connection agreements terminated if they fail to hit a series of milestones.

However, renewable energy developer Low Carbon has said Ofgem’s milestones are not strict enough, in its submission to the House of Commons Environmental Audit Committee’s inquiry into electrification of the economy,

The first milestone projects must meet is four years prior to when they are due to connect to the grid.

Low Carbon says 223GW of the 448GW of unbuilt capacity in National Grid Electricity System Operator’s (ESO) connection register has a connection date of 2032 or later.

This means that nearly half of all projects in the grid queue will not face vetting until at least 2028, halfway through the next Parliament, which the submission says is “inconsistent” with the UK’s targets for decarbonisation in the 2030s.

“These dates are too far into the future, failing to ensure that all projects in the queue are actively being developed,” the submission adds. “If Ofgem fails to strengthen the current rules, then ‘zombie projects’ will continue to block viable renewable energy projects from connecting to the UK’s electricity grid.”

Low Carbon calls for Ofgem to change the rules so that milestones are “frontloaded”, such as requiring that project developers secure land rights for their projects within six months of accepting a grid connection offer.

This would give developers up to 12 months to secure land rights from the point of submitting a grid application, factoring in three months each for offers to be processed and accepted.

Low Carbon also calls for other milestones to be brought forward, such as requiring planning applications to be submitted within two to three years of accepting an offer.

It fundamentally rejects the argument that speedier milestones would reduce competition, such as in Contracts for Difference (CfD) auctions, because fewer developers would be able to meet the new requirements.

The biggest issue stymying competition in CfD auctions is grid delays, which stops developers from progressing projects, says Low Carbon.

And it proposes that types of projects, like nuclear power plants that take many years to develop, can be exempted by the secretary of state from the stricter milestones.

RWE UK country chair Tom Glover told the committee last month that he has yet to see a single project connected to the grid faster and is encountering more delays since the launch of Ofgem’s initiative to unblock connection queues.

In response to the comments, an Ofgem spokesperson said: “We have met with representatives from Low Carbon recently and we invited them to propose any suggested reforms they have for further strengthening the way the grid connections queue is managed.

“While we continue to engage with a variety of industry stakeholders, we’re also driving forward implementation of the Connections Action Plan, working with DESNZ, ESO, ENA and other stakeholders as part of the Connections Delivery Board. We are completing this work at pace, but we do need to give the changes time to take effect. Following our addition of queue milestones to transmission connections contracts, we expect to see the first terminations from the connections queue later in 2024.

“We continue to keep progress against the Connections Action Plan under review, and we will go further if necessary.”