Interconnection: moving towards a strategically planned energy system

Our national grid is connected to other countries with large cables under the sea which carry electricity. These interconnectors allow us to import lower-priced electricity and to export surpluses, helping to reduce system costs, improve energy security and enable decarbonisation. This blog post will explain how interconnectors are already supporting the grid as we move to clean power, and how developing our interconnection infrastructure will mean we can respond to electricity demand efficiently and keep costs as low as possible for consumers.

How consumers are benefitting from interconnection

As we begin to look ahead to the future role of interconnection within a more strategically coordinated energy system, it is a good moment to reflect on the benefits interconnectors are already providing today. Operational interconnector projects have been instrumental in minimising shocks to wholesale electricity prices in Great Britain (England, Scotland and Wales) and have returned over £200 million to consumers in recent years through our cap and floor regime. For each interconnection project, we set an upper limit on the revenue the developer can earn. This is known as the cap. When revenues are high, excess profits above the cap are returned to consumers, lowering network charges on consumer bills. We also set a minimum revenue level, known as the floor. If revenues fall below this level, top-up payments apply. This reduces risk for investors, helping to support much needed investment in new clean energy infrastructure.

With a number of additional projects also in development, interconnection is playing an increasingly important role in Great Britain’s clean power transition.

Strengthening flexibility, renewable access and security across the system

Interconnectors form a significant part of the government’s Clean Power 2030 ambition, enabling Great Britain to draw energy from across neighbouring markets at times of reduced renewable domestic generation and providing a means to share surplus renewable energy generated in Great Britain.

We currently have ten operational interconnectors, linking us with seven neighbouring markets through 10.3 gigawatts (GW) of capacity.  These links play a crucial role in providing access to lower cost power, while also easing network constraints and helping to lower overall system costs for consumers. In the year to September 2025, interconnection enabled us to import around 43 terawatt hours (TWh) of electricity, around 13% of our total supply, reducing reliance on more expensive fossil fuel generation and supporting our renewable energy infrastructure. Over the same period, around 12 TWh of electricity was exported, supporting the efficient use of surplus renewable generation. This level of cross border trading is crucial to how our energy system balances supply and demand.

Interconnectors also strengthen security of supply, offering network resilience during periods of high demand or unexpected system events, an increasingly important consideration as more renewable energy connects into Great Britain’s network. If we want to remove the influence international wholesale gas costs currently have on our electricity prices, interconnection will play a vital role in making sure renewable energy can meet demand.

Alongside our operational projects, there is an additional 1.4 GW of new capacity now in construction, with a further approximate 8.9 GW in development following regulatory approval by Ofgem, demonstrating continued momentum in delivering a more connected, flexible and secure electricity system.

Harnessing the power of offshore wind

In Great Britain, offshore wind farms and interconnectors currently operate independently, and each connects to the shore separately. Offshore Hybrid Assets (OHAs) offer the potential for offshore wind and interconnection to work together as a combined asset. By 2030, Great Britain is expected to become a net exporter of energy with traditional point-to-point links continuing to play a role. In parallel, OHAs present a new opportunity to connect multiple markets through an integrated North Sea network, further increasing network resilience, grid flexibility and access to more affordable energy.

To explore how OHAs could work in practice, we are running an OHA pilot scheme for non-standard interconnectors. Through our two pilot projects, LionLink and Nautilus, we can test how existing regulatory frameworks might need to adapt to support these more complex offshore configurations.

As a result of its geographical position, Great Britain is one of the best places in the world for wind power. The relatively shallow waters of the North Sea mean it is already home to some of the world's biggest offshore wind farms. At the recent North Sea Summit in Hamburg, governments from across the North Sea region, including the United Kingdom and its European neighbours, reaffirmed a shared ambition for the North Sea to operate as an interconnected clean energy hub. OHAs will be central to making that vision a reality.

Our role in shaping the future strategic approach

Over the last year, we have been working alongside the Department for Energy Security and Net Zero (DESNZ) and the National Energy System Operator (NESO) to shape the enduring regulatory approach for future interconnection as we move towards a more strategically planned energy system.

As part of this work, we have published a call for input on the future strategic approach to interconnection which invites feedback on a range of topic areas, including:

• the potential route to market for future projects
• the types of competition that could be enabled
• possible ways in which we can ensure projects remain investable
• how financing models might need to evolve to reflect new asset configurations

The call for input was published alongside DESNZ’s next steps for electricity interconnection in Great Britain policy paper which sets out the government’s current position on the role interconnection.

Over the coming months, we will continue to engage with the sector to test our thinking, gather evidence and build a framework that supports timely, efficient and strategically aligned interconnection for the decades ahead.

Read and respond to our call for input:

Future strategic approach to interconnection