(Bloomberg) -- UK utilities expect to invest more than £77 billion ($98 billion) to upgrade the power grid over five years, increasing the burden on consumers to foot the bill.
Network operators across the country have submitted spending plans to the regulator for 2026 to 2031, saying they need to roughly double the grid-improvement levy currently paid by consumers.
That’s a tough ask, since the government has pledged to lower bills by unleashing a huge build-out of clean power. But the renewables expansion requires a strengthened grid, capable of transmitting vast amounts of electricity from remote offshore wind parks to population centers hundreds of miles away.
National Grid Plc’s grid spending plan would see customers slapped with a £44 annual levy by 2031, up from about £23 a year. Scottish Power Energy Networks and SSE Plc’s transmission business expect the burden on customers to double.
With grids failing to expand at the same pace as renewables, operators are increasingly paying generators such as wind farms not to run. So far this year, the UK has spent more than £1 billion in “congestion costs” to turn off plants that can’t deliver electricity because of grid constraints, and switch on others.
It’s hoped higher spending on the grid will reduce the need for such payments.
Regulator Ofgem will review the business plans with a view to publishing a draft determination next summer. Its final decision is expected late next year, before the plans come into effect in April 2026.
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