National Grid slams Ofgem’s upgrade plans

Ofgem’s plans to upgrade the country’s gas and electricity networks will not provide a “safe and reliable” grid system, according to Britain’s biggest energy distributor. The comment was made as […]

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By Priyanka Shrestha

Ofgem’s plans to upgrade the country’s gas and electricity networks will not provide a “safe and reliable” grid system, according to Britain’s biggest energy distributor.

The comment was made as the industry regulator announced its £22billion energy upgrade and renewal plans, which includes a £17billion investment in grid upgrades between April 2013 and 2021 and a further £5billion if necessary. This is expected to increase household energy bills by £15 in 2021.

National Grid criticised Ofgem’s proposals and said it does not allow it to put up its charges by enough to encourage the investment needed in the UK’s infrastructure.

In a statement released today, it said: “While the information currently available is limited, we believe that these initial proposals will not appropriately incentivise the essential investments necessary to provide safe, reliable networks for the UK consumer and avoid delays to the achievement of the UK’s environmental targets.

In particular, the financing packages proposed do not, on either a standalone basis or in comparison with other regulatory outcomes, adequately reflect the increased scale of investment and implicit risk associated with the major investment required in the coming years to build the energy system that our customers will need in the future, whether in transmission or distribution infrastructure.”

National Grid said lat year it needed to spend £21billion on electricity networks and a further £9billion on gas pipelines over eight years from April next year.