Supporting Great Britain’s electricity network supply chains

As the role of electricity expands, its impact on the wider economy is prominent. Our electricity network needs to be able to carry that electricity from where it is generated to where we use it. This is why we are seeing the biggest upgrade of our electricity network in decades.  

Ofgem is playing its part in ensuring the energy system benefits the Great British (England, Scotland and Wales) economy. The way to do this is by:  

• first and foremost, enabling an energy system that is low-cost, accessible, and reliable, including enabling infrastructure investment at lowest cost, supporting innovation and minimising price exploitation
• creating the conditions for investment, including reforming the connection queue and facilitating retail investment 
• simulating domestic supply chains, skills, and expertise 

Building large energy infrastructure requires significant investment, but we see the return on that investment in multiple ways. It can generate business for local vendors, create good jobs across Great Britain, encourage technological innovations and deliver tangible benefits for the communities it serves. The transition to clean energy may be challenging, but it comes with potential to benefit the whole economy. Keeping energy bills as low as possible will be crucial for consumers and the businesses that operate in Great Britain and add value to the British economy.  

Regulation that welcomes growth  

In 2024, the Growth Duty was extended to Ofgem. This means that we need to consider the desirability of promoting economic growth alongside our regulatory functions. Our forward work programme already recognises the need to maintain a regulatory environment that protects the interest of the consumer and enables growth.  

Earlier this week, a Government Guidance on Electricity Networks policy was laid in Parliament. It highlights the importance of capitalising on growth opportunities in infrastructure build and encourages Ofgem to support network companies in its delivery. This follows the outcome of the Ofgem Review. The review sets out three equal duties Ofgem will have in the future: 

• growth 
• net zero  
• consumer protection  

Consumer protection remains our primary focus, but growth is becoming increasingly important in the choices we make as a regulator.  

However, constraints in the electricity networks’ supply chain pose challenges. We cannot build the energy system of the future without a resilient supply chain. We have been working with stakeholders across the industry to address some of those resilience challenges.  

In March 2026, we launched our call for evidence on Growing Great Britain’s Electricity Supply Chains. We highlighted the importance of supply chain resilience. We noted that sourcing equipment locally can provide consumers with benefits such as: 

• shorter supply chains 
• growth  
• creating jobs across the country.  

In line with the government’s industrial strategy, our regulatory framework gives network companies substantial scope to go further in supporting GB electricity transmission and distribution supply chains where this delivers long-term consumer benefit. We indicated Ofgem’s support for measures that are evidenced to improve outcomes for consumers over time. We also tested whether any further policy clarification, incentives, or proportionate reporting would materially improve outcomes. 

We published the non-confidential responses to our call for input on 16 September 2026. These responses reinforced that building a resilient energy network system would not be possible without cooperation. Thank you for your insight, input and collaboration. 

Understanding the opportunity ahead 

Hardly anyone would disagree that consumers would benefit from stronger British supply chains. This begs the question: what do we need to do to get there? The responses to the call for evidence highlighted the following:  

• Ofgem's current regulatory framework provides enough room for growth and social value to be adequately considered
  • there is an investability challenge  
  • common threads are credible long-term demand visibility and clear treatment of risk and cost recovery 
  • there is a clear case for increasing transparency in how companies allocate supply chain spend 
• respondents broadly support proportionate reporting but as a diagnostic tool rather than a target 
• poorly designed interventions could raise costs, distort procurement decisions, weaken competition and crowd out smaller or competitive providers  

The responses to our call for evidence and various network companies’ reports show that network companies are already working with local supply chain providers. This means finding innovative ways to share benefits of investing in infrastructure. It will also help the economy grow.  

The feedback we’ve had does not point to the need for prescriptive procurement rules, mandated local-content targets, broader social-value regulatory requirements, or other material changes to the framework. Our immediate challenge is ensuring that we use the existing framework to optimise outcomes for everyone.  

What's next on our agenda?  

Affordability and consumer protection will always be central to everything we do. But this does not mean we can’t be ambitious on growth. This is especially true as we take on feedback from the Ofgem review and prepare for the change in legislation, This will make our growth duty as important as net zero and consumer protection.  

We are looking forward to the publication of the Electricity Networks Sector Growth Plan this October. We have worked closely with the Department for Energy Security and Net Zero, the Energy Networks Association, BEAMA and their members to encourage an ambitious set of actions that all parties involved can take forward collaboratively. This plan helps identify growth opportunities in electricity network infrastructure, but we still have more work to do.  

Our next steps are to create guidance to give network companies greater confidence when considering wider growth, resilience, and other consumer benefits in procurement decisions. But we need to strike a balance between ambition and exposing consumers and investors to financial risk. We'll explain the factors Ofgem will consider and the credible, proportionate evidence that companies can provide. We won’t be changing existing cost assessment and funding processes. However, we do want companies to think about what is best for the consumer in the long run. 

We expect to consult on this in the autumn of 2026.  

Stakeholders responded positively to our suggestion to introduce reporting requirements. We will soon start engagement around the design work of these. If you’d like to share your views on what our reporting should do, how we should carry it out and what content to include, please email Transmission.Acceleration@ofgem.gov.uk.