Ofgem to review how costs of grid are shared among users
The energy regulator is heeding calls for a radical overhaul of how Britain’s power lines and pylons are funded ahead of a ‘revolution’ which threatens to burden those who are left behind with higher bills.
Ofgem has kickstarted a long-awaited review of how it recovers the cost of maintaining the country’s electricity networks ahead of a boom in small-scale power units, such as solar panels and batteries.
“Electricity market and regulatory arrangements were designed for a system with very different characteristics to those we now expect in the future,” said Andrew Wright, a partner at Ofgem.
In the past the cost of maintaining Britain’s grid was spread across all those who use it. However, the steady shutdown of large power plants and rise of renewable technologies has brought a boom in the number of those who generate their own electricity and don’t help shoulder the shared costs.
The dramatic shift in how the UK powers its homes and businesses means those who are left behind could end up with higher bills by shouldering a higher share of the grid’s costs.