ENERGY regulator Ofgem has approved a 28 billion pound investment over the next five years to maintain a safe and reliable energy system. The upgrade plan is expected to add 108 pounds to consumer bills by 2031.
The approved investment is higher than Ofgem’s provisional assessment in July, which stood at 24 billion pounds, and comes as the government has pledged to reduce energy prices.
"The investment will support the transition to new forms of energy and support new industrial customers to help drive economic growth and insulate us from volatile gas prices," Ofgem CEO Jonathan Brearley said on Thursday.
Under Britain’s regulatory framework, gas and electricity network companies submit project plans and expected investment costs, which Ofgem then assesses.
Consumers pay for this investment through network charges, which currently account for almost a quarter of an average household energy bill.
The Department for Energy Security and Net Zero said on Thursday the investments were essential to keeping the lights on and ensuring energy security.
SSE, which owns Scottish and Southern Electricity Networks Transmission, said it welcomed the improvements to Ofgem's initial proposals and will review and assess the price control package in the coming weeks.
National Grid also welcomed the decision, saying it recognised the need for significant investment to ensure reliable operations, with the expected amount of power transport set to double.
Campaigners from the End Fuel Poverty Coalition said they recognised the need to ensure a reliable energy supply and to help homes benefit from more renewable energy generation. "But that shouldn't mean signing a blank cheque for network and transmission companies," they said.
