Electricity System Operator proposes £58bn investment in grid to achieve decarbonisation by 2035

An expanded offshore grid and new North-to-South onshore electrical spine in Great Britain have been proposed by the Electricity Systems Operator (ESO) in its £58bn investment plan for the UK’s power system to achieve the 2035 decarbonisation goal.

The ESO is responsible for operating the electricity system from a control room and manages the day-to-day balancing of supply and demand across the grid in Great Britain. It is a private company within the National Grid Plc group but is legally separate from other parts of the business such as National Grid Electricity Transmission, which is responsible for maintaining electricity transmission infrastructure.

The ESO’s report Beyond 2030: A national blueprint for a decarbonised electricity system in Great Britain builds on top of the ESO’s Holistic Network Design and makes a set of network recommendations to be implemented throughout the 2030s to decarbonise Britain’s electricity supply quickly.

The 2022 Holistic Network Design report set out the need for four new subsea high-voltage direct-current (HVDC) links connecting the east coasts of Scotland and England along with other major infrastructure investments. These are now being delivered as National Grid’s Eastern Green Link projects.

Its Beyond 2030 report leans heavily on expanding the capacity for current and future offshore wind developments to export electricity to the parts of Great Britain which will use it.

The report points to the prediction that there will be over 30GW of offshore wind in Scottish waters compared to 6GW of peak electricity demand in Scotland in 2035. This is why it is proposing a North to South electrical spine “potentially” from Peterhead to Merseyside, and offshore ‘bootstrap’ cables across the east coast of Britain, bringing electricity produced by wind turbines in Scotland down to the southeast of England which has high demand.

Regarding the transmission of electricity generated by offshore wind, it said “by 2035, three times as much undersea cabling will be laid than onshore infrastructure across Great Britain with significant additional power flow capability required onshore and offshore from north to south in the future”.

This will help connect 21GW additional offshore wind which is in development off the coast of Scotland to the grid in what the ESO said would be “an efficient and coordinated way”.

The ESO said all this extra transmission infrastructure, costed at £58bn, would enable the UK to meet its target of decarbonising the electricity grid by 2035 which would keep the country in line with the Sixth Carbon Budget as per the Climate Change Act 2008.

To deliver this in time for 2035, the ESO is calling for “swift and coordinated action across the energy sector, government, the regulator, and communities”.

The full Beyond 2030 report can be viewed here.

Map of infrastrcture to be delivered after 2030, proposed by the ESO

ESO executive director Fintan Slye said: “Great Britain’s electricity system is the backbone of our economy and must be fit for our future.”

Slye said the report “outlines recommendations on the investment needed and how and where to coordinate the build of this new critical national infrastructure.

“To deliver the clean, secure, decarbonised system set out by Government and Devolved Governments we must take swift, coordinated and lasting action working collaboratively across all parts of the energy sector, government, the regulator and within our communities.

A National Grid spokesperson said: “The huge growth in offshore wind, interconnectors, and nuclear power, will all generate more electricity than the networks are currently able to transport.

“The Electricity System Operator’s Beyond 2030 report recognises the need for networks to be delivered at pace and is an important step in unlocking a more affordable and resilient decarbonised electricity system in the UK.”

The spokesperson said the company is “already investing billions delivering the largest overhaul of grid in generations, The Great Grid Upgrade, to enable us to transport more homegrown clean energy to power homes and businesses across the UK as well as, in the longer term, reduce energy bills.

“We now look forward to working with the System Operator, Government and Ofgem on the further development needed to progress these reinforcements, and to move towards creating a Strategic Spatial Energy Plan, coupled with a consentable Centralised Strategic Network Plan, which sets out what energy infrastructure needs to be built, where and when, to deliver a capacity-rich, future-ready network that will serve society and underpin economic growth.”

National Infrastructure Commission commissioner Nick Winser said: “The ESO’s blueprint for a decarbonised electricity system is a welcome step forward in planning the network infrastructure we will need to meet increasing electricity demand.

“Transformational investment in the electricity network is needed to ensure we can make the most of low cost, low carbon wind power.”

Winser went on to say that “getting this right will help to reduce energy bills for consumers and enable the deployment of electric vehicles and heat pumps.

“It’s critical that this investment is delivered quickly. This will require coordinated action from transmission owners, government and Ofgem, including ensuring that the planning system is not a blocker to delivery.

“The communities hosting this infrastructure must also see direct benefits from its deployment.”

Energy and Climate Intelligence Unit (ECIU) energy analyst Jess Ralston said: “The UK’s gas bill has topped £100bn since the price started spiking more than two years ago with tax and billpayers alike having to fork out to cover it.

“That’s £75bn more than normal and that’s because the UK simply hasn’t invested enough in measures like insulating homes and upgrading the power grid that would have made us less dependent on international gas markets.

“Oil and gas prices are volatile and that won’t change. The Office for Budget Responsibility has modelled a scenario in which energy prices rise again, by 75% in 2025.

“By reinforcing the grid, we can use more British energy from renewables which will give the UK much greater energy independence as the output of the North Sea inevitably declines.”

The Energy Networks Association represents the companies which operate the electricity wires, gas pipes and energy system in the UK and Ireland.

Energy Networks Association chief executive Lawrence Slade said: “This plan is an important step in upgrading our grid, which is vital if we are to support greater electrification, the use of more low carbon technologies and increase energy security.

“To reach our net zero goals we need to maximise the use of existing power infrastructure, operate this infrastructure flexibly and innovatively and build new infrastructure.”

Slade said that in addition to the plans laid out in Beyond 2030, “electricity networks are spending and investing around £30bn over this price control period and undertaking the biggest programme of reforms in the history of the grid.”

RenewableUK director of future electricity systems Barnaby Wharton said upgrading the electricity grid was “long overdue”.

He said: “It’s essential that we don’t delay any longer and get on with the job, to ensure that we can get the vast quantities of clean power which we’re generating from offshore wind to British homes and businesses as efficiently as possible.

“This investment in new networks is absolutely vital, to slash bills, make our economy more competitive and boost Britain’s energy security.

“The measures set out in this ambitious plan put offshore wind at the heart of our future energy system, enabling us to decarbonise our electricity network by 2035 and securing our position as a global leader in this key technology.

“This report shows that building vital new grid will create 20,000 new jobs and boost our economy by £15bn in parts of the country which need regeneration.

“It also highlights the fact that local communities will have a strong voice in the wide-ranging consultations which will determine how these plans are delivered in a way which minimises environmental impacts , and that local benefit funds will be set up to recognise communities hosting new grid.”

Energy UK chief executive Emma Pinchbeck said: “The proposals set out by the ESO capture the necessary level of ambition to get the UK on track for economic growth, job creation, and a more cost-efficient energy system which best uses new technologies and manages demand from today’s customers.

“Everyone in energy is working at an accelerated pace to ensure the lowest cost electricity generation is connected to new and existing types of demand across the country, and that this is done in the fairest way possible to all customers.

“It is critical that the plan considers local needs, and that industry and government minimise the amount and impact of energy infrastructure, but we also know that the future energy system will vastly improve the way we power our homes and businesses in this country.

“This plan is part of a wider programme of work from government, industry, the regulator, and the ESO to make sure that the needs of the country, the needs of communities, and the needs of customers are considered together, and fairly – for example, the Government will need to streamline the planning process and begin engaging with communities.“

Prospect senior deputy general secretary Sue Ferns said: “Upgrading the UK’s electricity networks must be a national priority.

“However, the much-needed infrastructure rollout described in this report will not happen without a skilled workforce to plan, build, operate and maintain it.

“For several years we have been warning about a growing crisis of understaffing, overwork and widespread skills shortages in our electricity networks. This is becoming a barrier to the UK’s net zero and energy security goals.

“The government must work with Ofgem, network companies and the system operator itself to urgently address these issues and invest in the workforce who will deliver the grid upgrade.”

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