Most new developments require power, and some require a significant amount. As houses, warehouses, data centres and other projects connect to the grid, they accelerate the demand for power. This means the grid’s capacity must be increased to transfer power from where it is generated to where it is consumed. However, grid capacity has not kept pace with demand, and the consequences are being felt in delays to the delivery of new developments.

A triple threat

In ordinary circumstances, this might be manageable. However, the grid faces a triple threat of pressures that are straining power availability, hindering development and contributing to a growing queue for connection to the electricity grid.

1. New entrants demanding energy
   
   As innovations in technology continue to grow, so too does energy demand. Take data centres as an example: according to the National Energy System Operator, total annual electricity consumption by data centres could rise from 3.6 TWh in 2020 to as much as 35 TWh by 2050, driven in part by the increasing use of artificial intelligence (AI). As AI becomes more widely deployed, the surge in energy consumption is expected to accelerate. These new energy-intensive buildings are projected to play a key role in driving future economic growth. The substantial cost of the energy they consume is justified by the innovation and economic expansion that AI has the potential to fuel. However, the electricity grid has yet to adapt to effectively manage these new, concentrated single point demands for such large quantities of energy.
   
   
2. Increased demand from existing users
   
   Buildings regularly undergo retrofitting, changes in use, and renovation as occupier demand and expectations evolve. In a nation transitioning towards a net zero future, electrification plays a key role in the solution. This shift will introduce new challenges, which will vary depending on the building, its purpose, and its location. For example, decarbonising the larger, denser stock of urban housing will require a different technical approach compared to decarbonising smaller, more dispersed rural housing in secluded areas.
   
   
3. An energy system in transition
   
   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 adequate.

The way energy is consumed, generated, and stored is undergoing an unprecedented transition (see figures 1 and 2):

• Energy generation is shifting away from large, centralised and dispatchable sources, such as natural gas, which can be burned to produce energy on demand. Instead, it is moving towards smaller, distributed, non-dispatchable sources, like solar photovoltaics. While this energy has the advantage of being from a decarbonised source, it has the drawback of only being generated when the sun shines and demands greater land areas.
  
  
• Consumers can now generate their own energy thanks to innovations like rooftop solar. However, the supply is intermittent and unpredictable. As a result, consumers may draw energy from the grid one hour and supply it back the next, rather than continuously demanding energy. This shift is changing the direction of energy flow.
  
  
• The same unpredictability in energy generation has given rise to a growing energy storage sector, which was not necessary with fossil fuels. Energy storage enables consumers to draw energy from the grid during off-peak times, feed energy back during peak times, or completely eliminate their reliance on grid energy through off-grid systems.

Change is needed

Achieving net zero is a global challenge, and infrastructure will need to adapt to address and alleviate these new pressures. A combination of regulatory reform, innovation and investment will be essential. While some solutions will provide universal benefits, others must be tailored to meet the needs of the communities, buildings, and infrastructure that have developed over decades. Identifying the right solutions for specific locations will require sector-specific expertise, robust data and targeted investment to deliver efficient and effective outcomes.

Power in the wrong places

There is a queue of projects waiting to connect to the grid and start consuming power. The Energy Networks Association estimates that these projects will require a total of 27 GW of power. Grid IQ, developed by Savills Earth, also reveals that there is around 37 GW of available capacity on the grid. The question is: why are so many projects stuck in a queue when so much power seems to be available?

1. Promised, but not operational
   
   Power will be promised to projects that have proactively applied for a connection as part of the planning process but have not yet been built or connected. Historically, slower-moving projects have contributed to a growing queue for power. Reforms are aimed at eliminating these so-called ‘zombie projects’ from the queue to make way for other developments.
   
   
2. Some, but not enough
   
   Small volumes of power will be available across the nation, but these volumes are far below the requirements of most developments. Even modest housing developments may demand too much power from the most constrained substations. According to National Grid, 500 homes typically create a demand for 1 MW of energy. 11% of substations analysed by Grid IQ do not have this amount of capacity available.
   
   
3. Some, but spread out
   
   According to Grid IQ, urban local authorities often have the most headroom, with an average of 126 MW available, although specific availability can extend to over 1,000 MW. This additional capacity may indicate the potential to accommodate a land use with significant power requirements, such as a hospital, commercial facility, or large residential development. However, this capacity is dispersed across several different substations, meaning that there is often no single point with sufficient capacity for the project.
   
   
4. Grid-specific constraints
   
   Our analysis by Grid IQ has focused on primary distribution substations, which are just one of the multiple types of substations needed to move power around the country. Whilst these primary substations may have capacity, it must be matched by equivalent capacity throughout the infrastructure chain to allow power to move from its place of generation to its place of consumption. By monitoring plans for grid reinforcement, it is possible to anticipate the most promising locations for larger-scale development.
   
   
5. Suboptimal project design
   
   Optimising project design to minimise power demand will increase the likelihood of the necessary power being available and improve the efficiency of the development. Can energy efficiency be enhanced? Will the project be built in stages, thus staggering the requirement for grid capacity? Could rooftop solar photovoltaics, coupled with energy storage, reduce the power demand? Failing to consider these elements at the earliest opportunity could increase the costs, time, and difficulty of connection.
   
   
6. Other constraints
   
   Regular development constraints must still be considered, such as the proximity of the development to a substation. The greater spatial distribution of rural substations likely means that certain grid points are preferred for their location, while others remain underutilised for the same reason. The greater the distance from a substation, the higher the cost and complexity of connection.

Amongst other sources, Grid IQ uses data provided by Distribution Network Operators to evaluate the availability of grid headroom at given points in the electricity grid infrastructure across Great Britain.

The pathway to a grid connection

Places with the right power

Power availability is increasingly crucial to site selection and the ultimate success of a development. However, as we have seen, identifying availability is a complex process. Tools such as Grid IQ can help identify locations where grid capacity exists. Turning these locations into development opportunities requires further navigation of the grid process and the ability to overcome other constraints to development.

Connections reform is coming. This reform will create a direct link between the renewable resources available in each region of Great Britain, according to technology and the demand at each location. It is part of the transition from a centralised to a decentralised energy system, which will require time and investment to achieve. For the time being, however, developers must continue along the existing pathway to a connection, taking care to improve project design and enhance site selection in line with grid availability.

Get in touch with our Energy Infrastructure team to find out how we can help you.