The National Energy System Operator (NESO) has proposed a new fee system aimed at cutting costs and clearing the growing backlog of energy projects waiting to connect to the grid.
Under the plan, developers with stalled projects in the connections queue would face rising charges unless they either move forward or exit. The goal is to stop inactive projects from clogging up the system, freeing up space for those ready to deliver.
The proposal comes as part of wider connections reforms under review by Ofgem, following industry feedback last year. NESO has revised its approach to strike a balance between motivating developers to progress and preventing unnecessary financial burdens.
The fee would only apply to projects that have advanced into the future Gate 2 connections queue but have yet to submit a planning application.
Initially set at £2,500 per megawatt, the charge would increase by the same amount every six months, reaching up to £10,000 per megawatt if a project lingers too long without progress.
Importantly, the charge wouldn’t take effect immediately—it would only be activated under a specific trigger mechanism. If applied, developers would have to pay the fee when terminating or reducing their project’s capacity.
“Ensuring that we have effective measures to make connections reform a success is critical to the future of the electricity network. The proposed Progression Commitment Fee will maintain the impetus for projects to regularly assess the viability of their project. It will support wider reforms, as another tool to speed up the connections process, deliver the electricity needed for 2030 and beyond.”
Kayte O’Neill, Chief Operating Officer
NESO argues that the system will push developers to regularly review whether their projects are viable before applying for planning consent, helping to streamline the connections process.
With the UK’s energy transition accelerating, grid bottlenecks have become a major obstacle to getting new projects online.
NESO’s plan is designed to stop speculative developments from slowing down genuine investment, ensuring that projects serious about delivering clean power can connect to the grid faster.
