Grid capacity in Wales

Welsh Affairs Committee Closed Inquiry
Opened: 1 Feb 2022 Closed: 16 Oct 2023 Parliament page
The Committee has launched an inquiry which will explore the implications of grid capacity issues for the energy sector in Wales, particularly in relation to Wales meeting its net zero targets. Read inquiry launch and terms of reference
14 Recommendations
19 Conclusions
1 Report
4 Oral sessions
4 Events
Activity timeline 10 events
24 Jan
2023
Report published
21 Oct
2022
Report published
8 Jun
2022
Oral evidence
8 Jun
2022
Formal meeting (oral evidence session) · Room 16, Palace of Westminster
18 May
2022
Oral evidence
18 May
2022
Formal meeting (oral evidence session) · Room 5, Palace of Westminster
27 Apr
2022
Oral evidence
27 Apr
2022
Formal meeting (oral evidence session) · Room 5, Palace of Westminster
16 Mar
2022
Oral evidence
16 Mar
2022
Formal meeting (oral evidence session) · Room 5, Palace of Westminster
Oral evidence sessions 4 sessions
8 Jun 2022
View on parliament.uk
Oral evidence
Paul Van Heyningen · Department for Business, Energy & Industrial Strategy Rt Hon Greg Hands MP · Department for Business, Energy & Industrial Strategy
18 May 2022
View on parliament.uk
Oral evidence
Julie James MS · Welsh Government
27 Apr 2022
View on parliament.uk
Oral evidence
Ben Godfrey · Western Power Distribution Huub den Rooijen · The Crown Estate Julian Leslie · National Grid ESO Malcolm Bebbington · Scottish Power Peter Bingham · Ofgem Roisin Quinn · National Grid Electricity Transmission
16 Mar 2022
View on parliament.uk
Oral evidence
Chris Williams · Industry Wales Jon O'Sullivan · EDF Renewables Rhys Wyn Jones · RenewableUK Robert Procter · Community Energy Wales Tom Glover · RWE Generation
Title HC No. Published Items Response
First Report - Grid Capacity in Wales HC 218 21 Oct 2022 33 Responded
Recommendations & Conclusions
33 results
1 Conclusion Acknowledged
First Report - Grid Capacity in Wa…
We have heard that there are constraints on both the distribution and transmission grids in...
We have heard that there are constraints on both the distribution and transmission grids in Wales. Julie James MS told us Wales does not have the grid capacity it needs “right now”. However, Rt Hon Greg Hands MP told us … Read more
Government Response
The government recognises the challenges faced in Wales and evidence provided and states that network regulation is a matter for Ofgem.
Wales Office
View details
2 Recommendation Acknowledged
First Report - Grid Capacity in Wa…
We recommend that the Government explain the timescales of “today” and “tomorrow” in the context...
We recommend that the Government explain the timescales of “today” and “tomorrow” in the context of grid capacity in Wales. Further to this we recommend that the Government explains the evidence for its statement that the electricity grid in Wales … Read more
Government Response
The government recognises the challenges faced in Wales and evidence provided and states that network regulation is a matter for Ofgem.
Wales Office
View details
3 Conclusion Acknowledged
First Report - Grid Capacity in Wa…
To ensure that communities and business in Wales can decarbonise in line with government targets,...
To ensure that communities and business in Wales can decarbonise in line with government targets, grid infrastructure must be able to meet the projected increase in demand for electricity. The evidence we received suggested that the grid in Wales will … Read more
Government Response
The government acknowledges the importance of grid infrastructure to meet the projected increase in electricity demand. They reference the British Energy Security Strategy (BESS) and the appointment of an Electricity Networks Commissioner but do not commit to specific actions to address the identified issue.
Wales Office
View details
4 Conclusion Accepted
First Report - Grid Capacity in Wa…
While we understand that the UK Government must consider the energy and network needs of...
While we understand that the UK Government must consider the energy and network needs of the UK as a whole, we consider that it would be inequitable if the UK were to benefit from Wales’ natural resources for renewable energy … Read more
Government Response
The Government states that strategic planning will always take account of network needs in Wales, pointing to the Holistic Network Design (HND) as the first step towards a Centralised Strategic Network Plan (CSNP), and mentioning Welsh Government representatives input.
Wales Office
View details
5 Recommendation Acknowledged
First Report - Grid Capacity in Wa…
We recommend that the UK Government task the new Electricity Networks Commissioner to determine the...
We recommend that the UK Government task the new Electricity Networks Commissioner to determine the grid infrastructure necessary to enable industry, communities and businesses in Wales to decarbonise heat and transport in line with net zero targets.
Government Response
The government is reducing timelines for delivering strategic onshore transmission network infrastructure and appointed an Electricity Networks Commissioner, who is leading a project to identify areas where improvements could be made.
Wales Office
View details
6 Conclusion Acknowledged
First Report - Grid Capacity in Wa…
We recognise the strengths of an electricity grid that serves the whole of Great Britain.
We recognise the strengths of an electricity grid that serves the whole of Great Britain. However, we conclude that there are distinct challenges and opportunities relating to grid infrastructure in Wales that require specific focus and intervention from the UK … Read more
Government Response
The Government recognises distinct challenges and opportunities relating to grid infrastructure in Wales and is taking various actions to support stakeholder engagement and coordinated and strategic electricity grid network design with the Welsh Government represented on OTNR governance forums.
Wales Office
View details
7 Conclusion Acknowledged
First Report - Grid Capacity in Wa…
The Committee welcomes that Celtic Sea projects have been included in the list of infrastructure...
The Committee welcomes that Celtic Sea projects have been included in the list of infrastructure projects in the UK Government’s Growth Plan and notes the recent decision by The Crown Estate to seek to accelerate the leasing process where possible. … Read more
Government Response
The Government recognises different regions have different challenges and is taking various actions to support stakeholder engagement and coordinated and strategic electricity grid network design, citing Welsh Government representation on OTNR governance forums and direct engagement with the Welsh Government.
Wales Office
View details
8 Recommendation Accepted
First Report - Grid Capacity in Wa…
We note the work by the Welsh Government to develop a long-term plan for energy...
We note the work by the Welsh Government to develop a long-term plan for energy networks in Wales and call on the UK Government to explain how it is engaging with this. The UK Government needs to explain how it … Read more
Government Response
Strategic planning of the network takes account of network needs in Wales, and the Holistic Network Design (HND) recommends connections and infrastructure for projects in the Irish Sea and Celtic Sea. Welsh Government representatives feed into the HND through monthly meetings.
Wales Office
View details
9 Conclusion Accepted
First Report - Grid Capacity in Wa…
Upfront connection costs can be prohibitive and prevent the development of energy projects.
Upfront connection costs can be prohibitive and prevent the development of energy projects. This results in a “chicken and egg” situation whereby developers wait for other developers to commit to the funding of connection costs.
Government Response
The government points to Ofgem's decision to socialise a proportion of network reinforcement costs, BEIS's amendment to connections legislation, existing frameworks for developers to share connection costs and Ofgem incentive schemes as addressing the committee's concerns.
Wales Office
View details
10 Conclusion Accepted
First Report - Grid Capacity in Wa…
We are encouraged that Ofgem is reviewing connection arrangements and we look forward to hearing...
We are encouraged that Ofgem is reviewing connection arrangements and we look forward to hearing more about the progress being made in the run up to 1 April 2023. We consider that due to the tight timeframes set by government … Read more
Government Response
The government describes existing mechanisms to address upfront costs and incentivise developers to share grid connection and reinforcement costs, including Ofgem's decision to socialise a further proportion of network reinforcement costs and existing legislation allowing developers to share costs and receive reimbursement from second comers.
Wales Office
View details
11 Conclusion
First Report - Grid Capacity in Wa…
Larger companies have a financial advantage linked to scale, whereas smaller energy projects are often...
Larger companies have a financial advantage linked to scale, whereas smaller energy projects are often reliant on the development of larger projects and the availability of spare capacity once these have been completed.
Wales Office
View details
12 Conclusion Accepted
First Report - Grid Capacity in Wa…
A mechanism should be developed to allow small energy generation projects to defer and spread...
A mechanism should be developed to allow small energy generation projects to defer and spread grid connection payments over time.
Government Response
The government indicates that the connections framework overseen by Ofgem and DNOs already allows for instalment payments in appropriate circumstances.
Wales Office
View details
13 Conclusion Accepted
First Report - Grid Capacity in Wa…
We are encouraged to see that the UK Government recognises that grid connection costs can...
We are encouraged to see that the UK Government recognises that grid connection costs can be prohibitively high for developers. However, we are concerned by the decision to move more of the reinforcement costs to the network charges paid by … Read more
Government Response
The government points to Ofgem's decision to socialise a proportion of network reinforcement costs and BEIS's amendment to connections legislation to enable these reforms as addressing the committee's concerns.
Wales Office
View details
14 Recommendation Accepted
First Report - Grid Capacity in Wa…
It is not equitable that grid reinforcement costs should be shared by consumers in an...
It is not equitable that grid reinforcement costs should be shared by consumers in an area because this would create a higher burden for rural households and businesses and those in areas which historically lack existing grid infrastructure. We ask … Read more
Government Response
The costs of connecting a project to the existing network are charged to the connecting customer, and from April 2023, reinforcement costs will be met by electricity billpayers in the relevant distribution area.
Wales Office
View details
15 Conclusion Acknowledged
First Report - Grid Capacity in Wa…
There is a multiplicity of different bodies involved in securing planning consent for grid infrastructure...
There is a multiplicity of different bodies involved in securing planning consent for grid infrastructure and this process needs to be streamlined. We welcome the commitment to cutting processing times by fifty per cent and appreciate the challenge that this … Read more
Government Response
The Government recognizes the need to streamline the planning consent process and is amending the energy National Policy Statements (NPSs) and working with Ofgem to expedite the regulatory approvals process.
Wales Office
View details
16 Recommendation Accepted in Part
First Report - Grid Capacity in Wa…
We are encouraged to see the new Electricity Networks Commissioner appointed with a remit to...
We are encouraged to see the new Electricity Networks Commissioner appointed with a remit to reduce timelines and look forward to understanding in more detail how this will be achieved. However, it is not clear that the UK Government appreciates … Read more
Government Response
The government recognises the need for a step change and outlines actions from the Electricity Networks Strategic Framework (ENSF) and BESS to cut timescales. They mention amending National Policy Statements and a National Infrastructure Planning Reform Programme but do not commit to a projected timeline for reducing processing times by 50% within a year.
Wales Office
View details
17 Conclusion
First Report - Grid Capacity in Wa…
The planning consent process has created a queue of renewable generation projects in Wales to...
The planning consent process has created a queue of renewable generation projects in Wales to which grid capacity has been reserved before planning permission has been granted.
Wales Office
View details
18 Conclusion
First Report - Grid Capacity in Wa…
The UK Government should work with National Grid ESO, NGET, the DNOs and Ofgem to...
The UK Government should work with National Grid ESO, NGET, the DNOs and Ofgem to revise consenting processes to align the allocation of grid capacity with the application for planning permission. National Grid’s work should be expedited on reviewing commercial … Read more
Wales Office
View details
19 Conclusion Rejected
First Report - Grid Capacity in Wa…
Ofgem, as the market regulator, must ensure that the regulatory environment enables the decarbonisation of...
Ofgem, as the market regulator, must ensure that the regulatory environment enables the decarbonisation of energy markets. Whilst ensuring the best value for consumers is important and should remain one of Ofgem’s primary considerations, this should be balanced against achieving … Read more
Government Response
The government does not consider an amendment to Ofgem’s primary duty necessary, as they believe the existing duty to protect consumers' interests already includes the reduction of greenhouse gases.
Wales Office
View details
20 Recommendation Rejected
First Report - Grid Capacity in Wa…
We recommend that the UK Government amend Ofgem’s primary duty to include both ensuring the...
We recommend that the UK Government amend Ofgem’s primary duty to include both ensuring the best value for consumers and achieving net zero targets, by bringing forward government amendments to the Energy Bill. This would provide strong signals to developers … Read more
Government Response
The government does not consider an amendment to Ofgem’s primary duty necessary, as they believe the existing duty to protect consumers' interests already includes the reduction of greenhouse gases.
Wales Office
View details
21 Conclusion Accepted
First Report - Grid Capacity in Wa…
The policy in favour of laying cables underground in AONBs is welcome.
The policy in favour of laying cables underground in AONBs is welcome. However, due to the significantly higher construction costs it is likely that overhead lines will simply be re-routed around AONBs. This will mean that communities and businesses in … Read more
Government Response
Ofgem is revising how customers are charged for connecting to distribution networks to reduce connection costs, and project approval is a matter for Ofgem.
Wales Office
View details
22 Recommendation Accepted
First Report - Grid Capacity in Wa…
The Government should outline the circumstances in which higher grid construction costs, for example due...
The Government should outline the circumstances in which higher grid construction costs, for example due to undergrounding, are justified to enable rural communities to keep pace with the decarbonisation transition.
Government Response
Ofgem is revising how customers are charged for connecting to distribution networks to reduce connection costs, and project approval is a matter for Ofgem.
Wales Office
View details
23 Conclusion Deferred
First Report - Grid Capacity in Wa…
We have heard that community energy projects face specific difficulties in connecting to the grid,...
We have heard that community energy projects face specific difficulties in connecting to the grid, and that the UK Government is not aware of those difficulties.
Government Response
The Welsh Government has responsibility for renewable energy projects under 350 MW in Wales, and community energy schemes have access to support from the Welsh Government.
Wales Office
View details
24 Recommendation Rejected
First Report - Grid Capacity in Wa…
We recommend that the Government engage directly with community energy projects in Wales to understand...
We recommend that the Government engage directly with community energy projects in Wales to understand the difficulties they face connecting to the grid. The UK Government should lead a working group made up of the Welsh Government, grid infrastructure owners, … Read more
Government Response
The government states that the Welsh Government has responsibility for renewable energy projects under 350 MW and community energy schemes, and that the Community Energy Contact Group (CECG) has been re-established with a representative from Community Energy Wales. They decline to establish a separate working group at this time.
Wales Office
View details
25 Recommendation Rejected
First Report - Grid Capacity in Wa…
We recommend that the UK Government strengthens the legislative framework to support the growth of...
We recommend that the UK Government strengthens the legislative framework to support the growth of community energy schemes. The Energy Bill provides a potential opportunity to do this.
Government Response
The government states there are no legislative barriers to community energy groups, and so has no plans to bring forward legislative proposals at this time.
Wales Office
View details
26 Conclusion Accepted
First Report - Grid Capacity in Wa…
There is a lack of clear policy directing energy development companies on how to provide...
There is a lack of clear policy directing energy development companies on how to provide adequate benefits to communities hosting grid infrastructure.
Government Response
The government states that it has already committed in the BESS to review community benefit options for electricity network infrastructure, and is currently engaging with stakeholders to explore a more standardised approach to local community benefit packages.
Wales Office
View details
27 Recommendation Acknowledged
First Report - Grid Capacity in Wa…
The Government should incentivise energy companies and transmission infrastructure owners to provide benefits to communities...
The Government should incentivise energy companies and transmission infrastructure owners to provide benefits to communities hosting network assets. Communities should be directly consulted on the benefits they would like to receive. A starting presumption 40 Grid capacity in Wales should … Read more
Government Response
The government states that it has already committed in the BESS to review community benefit options for electricity network infrastructure, and is currently engaging with stakeholders to explore a more standardised approach to local community benefit packages.
Wales Office
View details
28 Conclusion Accepted
First Report - Grid Capacity in Wa…
Without an established system of anticipatory investment in grid infrastructure the significant opportunities for renewable...
Without an established system of anticipatory investment in grid infrastructure the significant opportunities for renewable energy generation in Wales will go under- utilised, which will have an impact on the achievement of net zero targets. Were grid infrastructure to be … Read more
Government Response
The government highlights Ofgem's work to create a price control framework that enables strategic investment ahead of need, along with efforts to accelerate strategic transmission network infrastructure and protect consumers. They state they are already working with National Grid ESO, Ofgem, and network companies on the HND, which identifies key strategic transmission projects.
Wales Office
View details
29 Recommendation Accepted
First Report - Grid Capacity in Wa…
The UK Government should use National Grid ESO’s Future Energy Scenarios to work with energy...
The UK Government should use National Grid ESO’s Future Energy Scenarios to work with energy companies and grid infrastructure owners to determine areas where anticipatory investment in grid infrastructure would be justified to achieve net zero targets. Where anticipatory investment … Read more
Government Response
The government highlights Ofgem's work to create a price control framework that enables strategic investment ahead of need, along with efforts to accelerate strategic transmission network infrastructure and protect consumers. They state they are already working with National Grid ESO, Ofgem, and network companies on the HND, which identifies key strategic transmission projects.
Wales Office
View details
30 Recommendation Acknowledged
First Report - Grid Capacity in Wa…
In order to utilise the opportunities for renewable energy generation in Wales a system of...
In order to utilise the opportunities for renewable energy generation in Wales a system of anticipatory investment in grid infrastructure needs to be created and implemented urgently. In the government response to this report, we request further information on the … Read more
Government Response
The Government is supportive of Ofgem's work to ensure its network price control is more forward-looking and enables strategic investment ahead of need. They regularly engage with Ofgem to understand their work on electricity network price controls and welcome the agile approach to regulation to enable strategic investment at the distribution network level across Great Britain.
Wales Office
View details
31 Conclusion Accepted
First Report - Grid Capacity in Wa…
The grid network has been built piecemeal on the basis of the energy needs of...
The grid network has been built piecemeal on the basis of the energy needs of the nation over time. The energy system in the UK is changing and electricity grid network design needs to adapt to meet this change. We … Read more
Government Response
The Government is committed to unlocking the required investment to deliver a secure, resilient, net zero-ready network and is taking a leading role in a more strategically planned approach for electricity networks. This includes the publication of the HND and upfront consideration of community and environmental impacts to provide more certainty in the planning and consenting process.
Wales Office
View details
32 Recommendation Acknowledged
First Report - Grid Capacity in Wa…
Due to the urgency of the situation the UK Government needs to take control of...
Due to the urgency of the situation the UK Government needs to take control of electricity grid network design by setting deadlines and targets for Ofgem, grid Grid capacity in Wales 41 infrastructure owners and other significant bodies including National … Read more
Government Response
The government states its commitment to delivering a secure, resilient, net-zero network, engaging with stakeholders and speeding up planning processes, but provides no specific commitments beyond ongoing engagement and existing plans.
Wales Office
View details
33 Recommendation Acknowledged
First Report - Grid Capacity in Wa…
As well as considering the grid in Wales as part of a Great Britain enterprise,...
As well as considering the grid in Wales as part of a Great Britain enterprise, the UK Government must recognise the distinctive challenges and opportunities associated with the grid in Wales. The UK Government should engage directly and regularly with … Read more
Government Response
The Government recognizes the distinct challenges and opportunities in Wales and states that the Welsh Government is represented on OTNR governance forums, with ongoing engagement to deliver projects and develop strategic network planning exercises.
Wales Office
View details
Government Response AI assessment · 30 of 14 classified
Accepted 13
Accepted in Part 1
Acknowledged 11
Deferred 1
Rejected 4
Total 14 recs + 19 conclusions