Ofgem sets out major reform package in next step to accelerate grid connections

Ofgem today unveiled sweeping proposals to speed up grid connections, whilst at the same time warning network operators to hit tough new targets or risk facing financial penalties.

The ‘connections end to end’ review update, published today proposes stronger licence requirements, financial penalties and tougher enforcement to end unacceptable delays developers are experiencing at every stage of the connections process. This is costing projects up to tens of millions of pounds in sunk costs and lost revenue.

The new regime for transmission and distribution network operators will be worked up in 2026 – aiming to slash delays in connecting ready-to-go new clean power generation; large-scale storage; minor connections for electric vehicles and heating; and demand from energy-intensive sites, including industry, housing and data centres.

Record volumes of power are being connected but there remains a pipeline of projects that are approved by network operators but not connected. Today’s proposals are the next crucial step in overhauling the connections system following today’s announcement by NESO that a new pipeline of deliverable, ready-to-go projects will be prioritised for connection to the grid.

These steps are critical to Ofgem’s five-year settlement announced last week (4 December 2025) aiming to unlock up to £90bn investment in the transmission network. This investment will upgrade power and gas grids, creating a future-ready system that better shields customers from volatile energy bills.

End-to-end review

The ‘end-to-end’ review has analysed and assessed each stage of the connections process across Great Britain’s three high-voltage transmission and six distribution operators to look at where changes can be made to help projects apply and connect to the grid as soon as possible.

The review found some developers facing delays of a few years beyond their original connection offer. Major projects have reported losses in the tens of millions; others face costs inflated up to 200% and schemes cancelled due to bottlenecks in investment and supply chains caused by delays.

It lays out the need for existing penalties for missed connection deadlines for distribution network companies (DNO) and no penalty for transmission companies to be reviewed. The review dubs this an “asymmetry of risk” with developers bearing huge costs while networks face minimal consequences for failure.

The review proposes to standardise connection processes, enforce deadlines and introduce tougher sanctions if operators fail to deliver. This includes writing enforceable standards licence conditions, with penalties for not hitting stricter milestones and deadlines, both along the customer journey and at the final delivery date. Ofgem is proposing significant rises in compensation for projects hit by delays and mandating the networks to publish real-time data on grid capacity, constraints and queue positions so developers can plan in detail and avoid bottlenecks.

Director General for Infrastructure, Akshay Kaul, said:

“With major delays impacting billions of pounds of potential infrastructure projects and limiting the success of our wider clean power ambitions, it was clear that the regulations that underpin the connections system needed to be reviewed urgently.

“The connections queue has now been reduced by nearly two thirds, ensuring that the projects in the queue are those that are needed to deliver the Government’s ambitious net zero plans. The days where hundreds of unviable projects would sit in the queue with no consequences are over. Instead, the right projects will be built in the right place and at the right time.

“But we must go further, which is why we’ve carried out a root-and-branch assessment of the entire system. Britain’s energy transition depends on networks delivering connections on time, so network operators must be accountable for any failure to get clean power plugged into the grid. We must ensure that customers seeking to connect these projects that the country needs for clean power and economic growth receive the standards of service that enable speedy connections, so that consumers see the benefits quicker.”

The consultation runs until 27 February 2026.

Notes to editors

The regulatory regime will cover the three transmission operators (TOs) owning and maintaining high-voltage electricity lines, the 6 distribution network operators (DNO) and the independent National Energy System Operator (NESO).

To better focus and structure the end-to-end review it has been split into seven themes, each representing an issue in the customer journey with an accompanying goal for desired outcomes at the end of the reform process. These themes and goals are:

• Visibility and accuracy of connections data – All useful data must made available transparently to connecting customers and other interested parties in order to inform customer’s connection applications.
• Improved standards of service across the customer journey – Connecting customers must receive a high standard of service at all stages of the customer journey, from pre-application to energisation.
• Network companies being required to meet connection dates in connection agreements – There should be proportionate requirements on network companies and NESO to meet agreed customer connection dates in connection agreements, commensurate with those on developers to meet project milestones.
• Quality of connection offers and associated documentation – Network companies and NESO should be suitably required to issue high-quality offers and associated documents and information to connecting customers
• Ambition of connection offers – Network companies and NESO should be suitably required to offer connecting customers ambitious connection dates, to ensure they are doing everything possible to expedite connections.
• Minor connections – Minor connections customers, ie those seeking to make connections at low voltages (such as domestic and small business customers installing heat pumps or Electric Vehicle charge points), should receive a prompt and consistent high standard of service from network companies.
• Provisions and guidance for determinations – There should be greater clarity and transparency for all parties on the determinations process, including on Ofgem’s role in determinations.