The United Kingdom has announced a reform package for its electricity market to keep a national pricing system. The reforms are expected to give the government more responsibility for planning the system and determining where clean energy infrastructure is located, based on what is needed for the long-term. The reforms will be largely based on the next issue of NESO’s Strategic Spatial Energy Plan, which should help improve the efficiency of the electricity system, by setting out the best locations for new energy projects across land and sea up to 2050 to speed up development. The Government also plans to work with Ofgem (the UK energy regulator) to review the Transmission Network Use of System charges to provide stronger incentives for investors to build generation where it is needed, and with NESO (the UK’s National Energy System Operator) to update outdated infrastructure and reduce the need for constraint payments.
These changes should help to bring down energy bills, by making the current system more efficient, ensuring low-cost investment into cheap clean energy projects, and reducing the cost of running the electricity network. This decision comes as the government takes a step closer to the clean power by 2030 target.
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