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The Savills Blog

Why the UK needs to invest in the National Grid to reach its net zero ambitions

Earlier this month, the Climate Change Committee reported that the UK is off-track to transform its power system to net-zero by 2035 and that a new climate-resilient power system is needed to decarbonise its electricity network.

The UK will not be able to speed up the delivery of renewables and meet net zero targets without addressing problems within the grid network. Our current system is aging, with the average age of electricity transformers around 63 years old. A focus on updating and extending our infrastructure holds the key to upscaling the delivery of renewables and electrifying our heating and transport systems. The grid is complex and vast, so improvement will take significant time and investment. It consists of 5,500 miles of transmission cabling and 500,000 miles of distribution cabling at a very basic level.

Although, we’re using less power than 50 years ago, grid capacity is at its peak due to the different type and location of use. The National Grid was designed around locations of highly intensive industrial demand, but our current system is much more disparate and dispersed, meaning significantly more connections are needed for lower demands causing more of a constraint on space. Aging assets also play a part: the grid needs to replace or upgrade assets to begin to rejuvenate old cabling, switchgear and substations, but we are not necessarily engaging with the grid as we should be.

INFRASTRUCTURE

National Grid Transmission and the Distribution Network Operators (DNOs) need to make considerable physical changes to their networks to accommodate the increase in demand and generation connections, as well as reconfiguring existing infrastructure to cope with the growing use of renewables. This means the requirement for land, space for new apparatus and time to replace/reconduct overhead lines to ensure our grid can cope.

New supergrid transformers (SGT) and substations will be needed in a long-term policy strategy. Developing new ways to store renewable energy will also be fundamental in this transition, whether that be through Battery Energy Storage Systems (BESS) or generation and storage of green hydrogen, to help to meet demand and providing additional resources when needed.

GROWTH OF RENEWABLES

We already have around 72GW of connected renewable generation and a pipeline of over 350GW of including wind, PV, hydro and battery storage. The problem is the intermittency of generation, and it again requiring more connections than the grid currently can provide. Ideally, more grid supply points are needed to support this generation queue, but the key will be management of grid connections for renewables. Without a whole system approach to connections the grid will continue to be a barrier to the UK’s climate targets.

The DNOs are looking to drive this change with progression of alternative network arrangements and managing the connection pipeline more effectively by offering flexible network connections, Active Network Management (ANM) and smart grid solutions, such as a Distributed Energy Resource Management System (DERMS), to enable whole system development and balancing.

While the positive engagement between Distribution and Transmission is progressing at a pace, it will still be some time before the system becomes more stable and accessible.

Moving forward, early engagement with DNOs is essential to ensure your securing your energy for development. By engaging with the grid earlier, you can confirm your connection capacity at the very start of a project, but continued engagement with the DNOs is key to align where investment is needed.

 

Further information

Contact Chris Phillips or Michael Lock

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