Key organisations referred to include:

Future System Operator: With the aim of being established by 2024 under the Energy Security Bill, this new body will bring together the planning for the electricity and gas systems, and potentially systems for new technologies like hydrogen and carbon capture and storage, into a single institution to enhance Britain’s ability to transition to a zero-carbon energy system and reduce the costs involved. The FSO will build on the existing capabilities and functions of the Electricity System Operator.

Transmission Operators: The three companies that own and operate the high voltage electricity transmission infrastructure in Britain – National Grid Electricity Transmission, Scottish Hydro Electric Transmission Ltd. and SP Energy Networks – and connect with the fourteen Distribution Network Operators across regions.

Improving Strategic Planning

Until recently, identification of electricity transmission need has been a slow, iterative, and case-by-case process. The excellent work of the Holistic Network Design (published in July 2022) provides a strategic blueprint for the coordinated connection of 23GW of offshore wind to the network by 2030. However, this should go further and faster.

Recommendation 1

The Future System Operator (FSO) should be established quickly and be responsible for producing a Strategic Spatial Energy Plan (SSEP)

We need a SSEP for Great Britain. To reduce energy bills as much and as quickly as possible, we need bold decisions on energy policy right across the system. It is unrealistic to imagine that we can wait and see what energy sources and demands arise, then hope to build the necessary networks in time, so a SSEP will forecast the supply and demand characteristics and their likely whereabouts.

Recommendation 2

The FSO, supported by Ofgem, should urgently assess the scope for new short-term and long-term regional flexibility markets

Although this recommendation does not directly lead to shorter delivery times for electricity transmission, demand flexibility and smart investment and operation of energy storage facilities can reduce the need for new transmission investment. Urgent development of zonal flexibility markets and new, more encouraging, planning and operation rules will reduce transmission investment costs and provide valuable opportunities to deploy more renewables earlier.

Streamlining Planning Consent

The planning process is where individuals and communities can influence the plans, however currently each application appears before individuals, communities, the Planning Inspectorate, local authorities, and national governments with little political or engineering context being established previously or at a system level. A consultation on the revised energy National Policy Statements (NPS) proposes amendments to bring forward new transmission infrastructure by reflecting the importance of strategic network planning and clarifying presumptions, including for example, on when underground cabling may be used.

Recommendation 6

National Policy Statements should be updated urgently and regularly thereafter

Helpful changes to the National Policy Statements are currently being consulted on and should be updated routinely every five years. In addition, the Energy NPS should be updated to reflect the recommendations in this report.

Recommendation 8

A new document Electricity Transmission Design Principles should be created

The Electricity Transmission Design Principles (ETDP) will provide be a public document detailing the principles and methods used to design the system and decide the configuration of assets; onshore or offshore, overhead or underground. This will give a clear basis for communities and other stakeholders to understand proposals and a clear foundation for the Planning Inspectorate’s consideration. It could also be used to drive innovation and best practice sharing.

Expediting regulatory approval

The regulatory process has evolved from considering individual transmission lines to groups of them, but it is not settled, streamlined, regular and operating at a system level. It still adds uncertainty and significant time to the process – this is time we cannot afford.

Recommendation 9

Ofgem should urgently conclude the Future Systems and Network Regulation consultation and establish a new regulatory arrangement with the Transmission Operators

There should be a strong and heavily incentivised responsibility on Transmission Operators to deliver to time and cost. And returns to shareholders should reflect this. Successful delivery should lead to superior returns, unsuccessful delivery to lower returns. These incentives should be reinforced by a strong emphasis on their licence obligation to provide an efficient, coordinated and economic system.

Community Engagement and Benefit

People and the communities in which they live and work will be impacted by new transmission infrastructure. These impacts may be seen as negative (e.g. loss of visual amenity) or positive (e.g. economic opportunities). But in either case, there is a need for constructive engagement and agreed public rules or guidance on community benefit, so affected individuals and communities have clear information to enable proper individual and collective assessment.

Recommendation 12

The FSO and TOs should work with the Government to design and implement a focused information campaign on the need for a grid refresh

The next three decades will see a significant upgrade to our electricity transmission system. The importance of this work to our country and to the environment needs to be communicated to the whole population so that when individual proposals for reinforcement are made, communities have some context in which to view them.

Recommendation 13

A clear and public set of guidelines for Community benefit should be established

Following the recent DESNZ consultation on community benefit, Government and Ofgem should agree and publish guidelines on benefit sharing for individuals and communities affected by new or upgraded transmission lines.
We suggest two components:

1. Lump sum payments for individual households close to new lines.
2. A community fund to be established and distributed in the locality of new lines. This fund should be governed locally and the money should be spent on local schemes to decarbonise the energy system and homes.