UK energy regulator Ofgem has given a provisional green light to an initial £24bn investment programme to enhance energy security while enabling the transmission of more clean energy from renewable sources.

Over £15bn will ensure the continued safe operation of Great Britain’s gas transmission and distribution networks, making sure they deliver safe and secure supplies of gas to households and businesses across the UK.

An initial £8.9bn investment is being committed to Britain’s high-voltage electricity network, with a further £1.3bn ready to go to power the biggest expansion of the electricity grid since the 1960s.

The draft settlement is the first step in an estimated £80bn investment programme boosting electricity network capacity, protecting UK households from the volatile international gas markets that caused the massive fluctuations in energy bills in recent years.

The investment in the grid, which will rise to around four times the current spending levels, will allow for 80 transmission projects and all associated works right across the country to be completed within five years. This will increase the grid’s capacity, through new power lines, substations and other technologies, to handle the flow of electricity from new renewable sources.

These projects, which are also vital for driving growth, will upgrade over 4400km of overhead lines and deliver 3500km of new circuits, including investments offshore, doubling the total build in the past ten years. It means up to 126GW of clean power generation will be connected to the grid by 2030 alongside additional flexible storage and technologies, enough to power millions of households with clean, stable and secure energy.

Over the past six months, the energy regulator has scrutinised spending proposals from the electricity transmission owners, National Gas and the gas distribution companies to ensure they represent the best value for billpayers. Emphasis has been put on delivery targets while pushing companies to be as efficient as possible and, where necessary, bids that it does not think are in the best interests of consumers have been turned down. This scrutiny has resulted in potential reductions of more than £8bn, equivalent to around 26% of the initial proposals put forward.

“Britain’s reliance on imported gas has left us at the mercy of volatile international gas prices which during the energy crisis would have caused bills to rise as high as £4000 for an average household without government support,” said Ofgem (www.ofgem.gov.uk) CEO Jonathan Brearley. “Even today the price cap can move up or down by hundreds of pounds with little we can do about it. This record investment will deliver a homegrown energy system that is better for Britain and better for customers. It will ensure the system has greater resilience against shocks from volatile gas prices we don’t control.”

These 80 projects, he said, were a long-term insurance policy against threats to Britain’s energy security and the instability of prices.

“By bringing online dozens of homegrown, renewable generation sites and modernising our energy system to the one we will need in the future, we can boost growth and give ourselves more control over prices too,” he said. “Doing nothing is not an option and will cost consumers more; this is critical national infrastructure. The sooner we build the network we need, and invest to strengthen our resilience, the lower the cost for bill payers will be in the future. However, this can’t be done at any price, which is why we have built in cost controls and negotiated a fair deal for both investors and consumers. And we won’t hesitate to intervene if network companies don’t deliver on time and on budget.”

This investment covering upgrade and expansion of the electricity grid, maintenance and also gas depreciation in its entirety is estimated to increase network charges on bills by £104 by 2031. This includes £30 for the gas networks and £74 for the electricity grid.

Around half of this investment, including £30 on gas networks, is needed for the gas and electricity grids to maintain safety, resilience and reliability. The remainder, around £52, will be used to expand the capacity of the electricity grid to deal with the rising demands of a more electrified energy system, as the UK moves away from gas.

This investment (£52) alone is expected to lead to around £80 of savings for consumers by 2031 compared with not investing by reducing constraint costs – money paid to wind farms to switch off because the grid is unable to transmit their power output – and making better use of clean renewable energy so the country does not have to pay for expensive gas plants to serve demand. This means bills are expected to be around £30 lower than they would have been had this investment in upgrading and expanding the electricity network not been made.

Taken all together, the net cost of these investments on bills amounts to around £24 a year, or less than 40p per week, by March 2031, although this does not take into account the overall benefits of reaching clean power that can reduce bills.

The £30 increase in gas network charges on bills by 2031 would be necessary in all scenarios to maintain safety, resilience and reliability in the gas networks. These costs should also reduce even further as the benefits from the investment fully materialise through the 2030s.

The draft determinations are now published for consultation with final decisions made by the end of 2025.

A statement from energy delivery company National Grid (www.nationalgrid.com) said: “We are pleased to see Ofgem continuing to recognise the need for significant levels of investment in networks, and the requirement for an investable framework to support its delivery.”