The UK Chancellor Jeremy Hunt is set to announce in the Autumn Statement that households living close to new pylons and electricity substations could receive up to £1,000 a year off energy bills for a decade, as part of the government’s plan to reform the model for connections and support the net zero goal.
The UK needs a massive upgrade of its electricity network to better connect with new renewable energy sources and to enable thousands of vehicle charging points. The scheme is part of the government’s and Ofgem’s plan to reform the model for connections, which now moves at a pace set by each network operator and can take up to 15 years for some projects.
The government and Ofgem have told National Grid’s electricity system operator that they are “minded” to adopt its proposals to increase transmission capacity and reduce delays. The plan would allow the energy secretary, Claire Coutinho, to intervene in cases where specific new developments are deemed strategically important for the UK’s net zero goal and economic growth.
The plan is motivated by several big projects that are likely to involve significant investment from the UK government, such as Tata’s new £4bn electric battery factory in Somerset, and the switch to electric arc furnaces at Britain’s biggest steelworks at Port Talbot and Scunthorpe, owned by Tata and Jingye respectively. These projects are expected to create thousands of jobs and reduce the carbon footprint of the automotive and steel sectors, but they also require a large and reliable supply of electricity from the grid.
The plan to speed up connections is also aimed at supporting the expansion of renewable energy projects, such as wind and solar farms, which are essential for decarbonising the UK’s electricity generation. The UK has been successful in cutting carbon emissions from electricity generation by around three-quarters since 1990, due to a declining use of fossil fuels and an increasing use of renewables and nuclear power.
The government has pledged that all of the UK’s electricity will come from low carbon sources by 2035 and has plans to expand offshore wind, solar power and nuclear reactors. However, the government’s independent advisers, the Climate Change Committee (CCC), have called the UK’s efforts “worryingly slow” and warned that the UK risks missing its net zero target by 2050 without clearer planning and much faster action.
The UK still relies heavily on fossil fuels for its total energy needs, which include things like petrol cars and gas heating. Buildings account for about 17% of the UK’s greenhouse gas emissions, mainly due to burning fossil fuels for heating.
The government has committed to installing 600,000 heat pumps a year by 2028 to replace gas boilers. Heat pumps use electricity rather than gas and are more efficient than boilers. They work by extracting heat from the air, ground or water and transferring it to the home. The government is offering grants of £5,000 to help homeowners in England and Wales install a heat pump.
Despite the push for more renewable energy, the government is granting 100 oil and gas production licences for the North Sea, saying it wants to reduce the UK’s reliance on imported energy from “hostile states” and that some fossil fuels will still be needed when net zero is reached. The CCC says the expansion of fossil fuel production “is not in line with net zero” and that the UK should phase out oil and gas extraction as soon as possible.
