OFGEM injects more competition into electricity transmission network

Electricity pylonsBy DARA BUTTERFIELD

OFGEM has announced new competition arrangements for some of GB’s electricity transmission network along with changes into how network infrastructure is planned and regulated.

By as early as 2016 separable, high value onshore transmission assets could be subject to competitive tendering. The move is intended to benefit consumers through cost savings and innovation.

The other change the body is bringing in is that the National Grid will have an enhanced role to identify and assess investment in the transmission network. OFGEM has said that this will help improve GB’s transmission network as the country aims to reduce carbon emissions and replace ageing infrastructure.

Martin Crouch, Senior Partner for Transmission, Ofgem, said: “GB’s transmission network requires substantial investment over the next decade. Our decision today, to open competition for some onshore transmission assets and providing the system operator with more powers in network planning, will ensure the system continues to be fit for purpose, and that consumers are getting value for money.”

As system operator, National Grid is responsible for coordinating the flow of electricity through the transmission network. It will now have extra responsibilities to identify the future needs of the onshore and offshore network, and to consider the value of more interconnection to other countries.

This will help ensure that the network is planned and operated in an efficient, economical and coordinated way. This will lead to lower network charges to help keep consumer bills down.

The announcements mark the conclusion of Ofgem’s Integrated Transmission Planning and Regulation (ITPR) project. Ofgem will now engage with stakeholders as it develops the tendering arrangements for onshore transmission assets, with the aim of being able to run the first tender in 2016 or 2017.

Pixie Energy

Pixie logo Pixie Energy is an incubator and a facilitator of strategic research and project work, focusing on energy regulation, policy and markets at the local and national level. Find out more about Pixie Energy here.

Local Energy Matters: Scotland

Local Energy Matters: Scotland is a free-to-download brochure with a focus on energy tariffs in the two Scottish electricity distribution regions, as well news on local energy and low-carbon schemes.

Previous editions can be download here.

Scottish energy market overview

You can read an overview of the Scottish energy market here.

Scottish Government energy feed