Currently, there is a pressing issue facing new real estate developments across the UK: a significant backlog of projects waiting to connect to the electricity grid, totalling a demand of 27 GW against an available capacity of 37 GW, as reported by our latest research using Grid IQ by Savills Earth. This discrepancy highlights a crucial challenge in the modernisation of our energy infrastructure as grid capacity has not kept pace with the accelerating demand.

Despite the apparent surplus in capacity, several factors prevent projects in the queue from utilising this available capacity. For instance, small power volumes are available nationwide, but these volumes fall short of the requirements for most developments. National Grid indicates that 500 homes typically generate a demand for 1 MW of energy. Grid IQ's analysis reveals that 11% of substations lack the requisite capacity to meet this demand.

The traditional grid

Traditionally, energy generation has depended heavily on large, centralised power plants powered by sources such as natural gas. The grid operated in a single direction, delivering electricity from a few large generators straight to consumers. While these plants were effective in meeting demand by producing energy on demand, they also had a significant carbon footprint.

Availability of power is broadly aligned with population distribution. Urban areas cover approximately 14% of Britain’s land area, hosting two-thirds of both firm capacity and the nation’s population. Similarly, almost two-thirds of the nation’s grid headroom is concentrated within these local authorities. In the world of centralised and predictable power supply, this approach was sufficient. However, in a nation shifting to renewable energy as a means of achieving a net zero electricity grid by 2030, it is no longer appropriate.

A decentralised grid 

Today, the energy landscape is rapidly shifting towards a decentralised model. This transition is marked by a move away from centralised, dispatchable power sources towards smaller, distributed, and often renewable sources. While these sources are cleaner, they introduce new challenges such as intermittency and variability in energy production. We can solve these problems by introducing energy storage and influencing consumer behaviours, but the change will take time.

Energy storage 

Innovations like rooftop solar panels empower consumers to generate their own electricity, contributing to a dynamic energy flow where consumers can both draw from and supply energy to the grid. As many as 1.4 million UK households have solar panels, according to government data from December 2024. This is supported by advancements in energy storage technologies, allowing consumers to store excess energy for use during peak times or even disconnect entirely from the grid.

Another important but often overlooked fact is that the grid is increasingly relying on battery storage systems for balancing services. Last October, after a Norway-UK power link failure, the supply from this link dropped from 1.4GW to zero in two seconds (according to Solar Power Portal). Batteries responded almost instantly by providing immediate power.

Challenges and reforms

The transition to a decentralised energy system necessitates reforms in grid management and connectivity. Future reforms aim to establish direct links between renewable resources and local demand across Great Britain. However, these reforms require substantial time and investment and may increase risk instead.

For example, the newly proposed CP2030 action plan will make it more challenging for certain types of technologies to secure a grid connection in different regions.

In the interim, developers must navigate existing pathways to grid connection, optimising project design and site selection based on available grid capacity. If we are to reach the goal of clean power by 2030, connection dates of 10 to 15 years are not acceptable.

The future 

If renewable energy sources are to be embraced and consumers gain more energy autonomy, collaboration among stakeholders, government, developers and technology providers will be essential to overcoming grid constraints and ensuring clean, reliable energy is accessible to all. This transformation not only represents a technological shift but also a societal commitment to a greener future.

Further information

Contact Joe Lloyd and Mushfiqur Rahman

Market in Minutes: GB electricity demand connection update