Ofgem delivers £300 million down payment to rewire the UK

Ofgem, the UK’s independent energy regulator, has made a £300 million ($425 million) down payment for over 200 low carbon projects to get the nation ready for more electric transport and heat.

New cabling infrastructure is expected to support 1,800 new ultra-rapid charging points on motorways, tripling the current network. A further 1,750 charge points will be supported in towns and cities.

The funds are part of a broader investment programme for safe, secure and clean energy, with £40 billion ($56 billion) confirmed and more to follow in 2022. The investment will be delivered in the next two years and is part of a bigger plan to ensure the UK has the energy infrastructure to support the move to low carbon transport and heating while maintaining secure supplies.

Every region in the UK will benefit, with 204 net zero projects worth £300.5 million across England, Scotland and Wales. These shovel-ready, low carbon projects start this year, supporting clean transport and heat, and opening up local electricity grids to take on more low carbon generation.

While electric car ownership is on the rise, Ofgem research has found that 36% of households that do not intend to get an electric vehicle are put off making the switch over a lack of charging points near their home. An extensive motorway charging network and more charging points in cities and train stations will help address this ‘range anxiety’, which is why Ofgem is accelerating investment to boost charge point installation.

Cities like Glasgow, Kirkwall, Warrington, Llandudno, York and Truro will benefit from increased network capacity to support more ultra-rapid charge points, increased renewable electricity generation and the move to more electric heating for homes and businesses. Investment also covers more rural areas with charging points for commuters at train stations in North and Mid Wales, and the electrification of the Windermere ferry. 

Jonathan Brearley, chief executive of Ofgem said, “This £300 million down payment is just the start of building back a greener energy network which will see well over £40 billion of investment in Britain’s energy networks in the next seven years. The payment will support the rapid take up of electric vehicles, which will be vital if Britain is to hit its climate change targets. Drivers need to be confident that they can charge their car quickly when they need to. We’re paving the way for the installation of 1,800 ultra-rapid charge points, tripling the number of these public charge points. Drivers will have more charging options for longer journeys.”

Rachel Maclean, Transport Minister, said, “With more than 500,000 electric cars now on UK roads, this will help to increase this number even further as drivers continue to make the switch to cleaner, greener vehicles.”

David Smith, chief executive at Energy Networks Association (ENA) which represents the UK and Ireland’s energy networks businesses, said, “Delivering a green recovery for seas, skies and streets, over £300m of electricity distribution network investment will enable wide-ranging projects, which help tackle some of our biggest net zero challenges, like electric vehicle range anxiety and the decarbonisation of heavier transport. This new funding shows the social, economic and environmental benefits that can be brought forward by industry working closely with a flexible regulator.”

Ofgem, the ENA and each of the Distribution Network Operators (DNOs) launched a call for evidence in February for energy networks to come forward with projects that could help Britain reach net zero emissions faster and support the economy as the country comes out of the Covid-19 pandemic.

Last year, Ofgem announced its greenest ever price control with billions invested into network companies and the system operator from April 2021. The regulator has indicated that it will allow billions more investment and better use of flexible technologies and innovations for the local electricity networks from 2023.

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