The gas and electricity regulator has revealed a £22bn (€21.6bn) investment plan in UK infrastructure over the period 2013-2021.
The £22bn programme comprises a £15bn investment in the upgrade and renewal of the high voltage electricity network in England and Wales, including attaching new power plants to the grid, as well as improving high pressure gas networks in the UK, which transfer gas from offshore gasfields to the main network. The remaining £7bn is for the low pressure gas network – half of which is controlled by National Grid – which supplies homes and businesses across the UK including all British Gas customers.
Ofgem said the £22bn programme will see household bills rise by £7 next year and up to £15 by 2021. Distribution costs account for around 20% of a household gas bill, with any large-scale investment programme therefore having a material impact.
However, the proposals were severely criticized by National Grid as they represent a cut by around 20% compared to its forecasts (National Grid judge necessary to spend more than £30bn over the period).
The final proposals will be published in December following a consultation.