Britain will be at increased risk of blackouts under Ofgem plans to cut investment in energy networks, the boss of National Grid has claimed.
John Pettigrew warned that power lines in parts of the country would start to “decay” after the energy regulator rejected its proposals to bill consumers for replacing them.
“It is deeply concerning for us because ultimately you’re increasing the risk on the network,” he told The Times in an interview. “The risk of a loss of supply increases as a result of not spending as much on asset health, because the assets are deteriorating as they age.”
The FTSE 100 utility group and fellow regulated network giants SSE and Scottish Power are at loggerheads with Ofgem over a draft price settlement that would halve their returns from 2021 and disallow billions of pounds of proposed investments.
Network companies’ spending is funded through levies on energy bills and the regulator says the draft settlement will deliver “unprecedented value for money for consumers”.
It says that in some cases companies have simply failed to justify expenditure, while in other cases it would be better to wait and approve spending on big new projects over the next five years as it becomes clearer what is required to hit climate targets.
Mr Pettigrew, 51, argued that Ofgem’s plans would increase risks to security of supply, lead to job losses and hamper efforts to tackle climate change. He said National Grid was prepared to file an appeal against the plans to the Competition and Markets Authority for the first time, if Ofgem did not relent by a final settlement in December.