Ofgem’s new rules speed up grid connections for low-carbon energy projects, reducing delays with the ‘First Ready, First Connected’ approach.
Apatura welcomes reforms to enable low-carbon projects, including energy storage, to come online much sooner – as a result of the phasing out of the old ‘First Come, First Served’ approach.
In 2023, a BBC report revealed how the GB grid is one of the slowest in Europe when it comes to offering grid connections to low-carbon energy projects. In this report, it was revealed that around £200 billion-worth of solar, battery, and onshore wind projects were currently waiting in a queue for the grid. These delays, where some projects are waiting 10-15 years for a connection, are putting net zero in jeopardy.
Read on to learn more about the National Grid’s connection queue management changes and the new reforms made by Ofgem.
Current grid connection delays
Ofgem recently stated that stalled, slow-to-progress, and non-viable projects in the connections queue “result in a high attrition rate of 60% to 70% which ultimately fail to materialise or connect”.
Furthermore, the average gap between requested and offered dates has widened from 18 months to five years, with over 40% of 400GW of new generation capacity holding contracts having connection dates of 2030 or beyond. Some are as late as 2037.
Waiting in the transmission line…
According to National Grid Electricity System Operator (ESO), since October 2022 the transmission connections queue has grown by more than 275GW, and has been growing at an average of over 20GW a month for the last 12 months. The distribution connections queue has also continued to grow, and is expected to exceed 800GW by the end of 2024.
Ofgem updates grid connection rules
In November 2023, regulator Ofgem announced new rules to speed up grid connections for viable projects and allow stalled or speculative projects to be forced out of the queue, laying the groundwork for a move away from the existing ‘First Come, First Served’ system.
The rule change gives the transmission system operator in England and Wales, National Grid Electricity System Operator (ESO), the power to introduce milestones. This enables it to terminate stalled projects that are blocking the queue for high-voltage transmission lines, clearing the way for ready-to-go generation and energy storage projects to connect.
The new ‘First Ready, First Connected’ approach
Following consultation with industry and Ofgem’s rule changes, National Grid ESO has published initial proposals to further develop long-term connections reforms – applying the ‘First Ready, First Connected’ approach to the whole queue. This could potentially halve its size, by enabling earlier connection dates for viable projects.
Previously, these reforms – known as ‘TMO4’ – would only have applied to new connection applications and significant modification applications received from January 2025 onwards. However, the latest proposals aim to apply the reforms across the whole of the current queue. These will be referred to as ‘TMO4+’.
How will the latest reforms speed up connections?
According to the ESO, retrospective application to the whole of the queue will deliver quicker connections for viable projects by:
- Raising entry requirements
- Removing stalled projects
- Using existing network capacity and better allocating available network capacity.
These proposals, which still need to go through the relevant regulatory processes, will be achieved under the reformed ‘First Ready, First Connected’ (TMO4+) ‘gated’ approach. Projects will enter the connections process at ‘Gate 1’ but will need to meet the criteria to arrive at ‘Gate 2’, to prove they are connection-ready.
It is only at this point that projects can obtain a queue position and a connection date.
ESO said it intends to group projects together for Gate 2 assessment at regular intervals throughout the year to ensure the process is efficient. Under this system, projects will be assigned a queue position based on the date that they demonstrate having met Gate 2 criteria. Projects will also be allocated a connection date and connection point for the capacity and technology they applied for at Gate 1.
Projects will be allocated supporting transmission reinforcement works, user commitment liabilities and securities, as well as queue management milestones based on their confirmed connection date.
Projects that meet Gate 2 criteria can either retain their existing connection date or request an accelerated connection date based on the reformed queue.
Where projects in the existing queue do not meet the criteria, they will move to an indicative connection date and an indicative connection point.
When will the grid connection queue changes happen?
Implementation will require changes to industry Codes and Licence Conditions, and the code modification process will provide the opportunity for formal consultation with stakeholders as the proposals are progressed.
Subject to Ofgem’s approval of timelines for the code modification process, this reformed process could be in place by January 2025, according to the ESO.
The ESO will continue to develop implementation plans alongside Ofgem and industry, while still exploring transitional arrangements – which could involve earlier introduction of aspects of ‘First Ready, First Connected’ (TMO4+).
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