Where are we on connections reform?

Further delays in connections and getting offers out

Of the projects due to connect in 2026/27, 210 have had their dates delayed by Transmission Operators (TOs) – that's 62% of clause 1 and 2a protected projects. Ofgem has made clear its 'frustration' on this matter and that affected projects should get clear communication and 'the most ambitious date possible'.

Following the delay in the timeline for Gate 2 offers due to 'technical and engineering matters', the first offers have now landed. NESO has promised regular dashboards that provide a snapshot of performance against key milestones and we're awaiting confirmation that it has agreed Construction Planning Assumptions with TOs and engineering design work has commenced.

Impacts on investment

The delays have created a difficult situation for projects with Technical Limits offers to connect in the next few years. They won't get a firm connection offer until October this year at the earliest (and as late as March next year), but they need to be moving to final investment decisions and placing supply chain orders now.

Technical Limits was a great innovation by networks to get projects connected early and we must not lose the prize. This is an area for the 'tri-partite' governance to grip – with TOs confirming the Technical Limits at Grid Supply Points as soon as possible so DNOs can confirm Technical Limits offers.

The delays are also causing concerns for projects looking to bid into the next round of CfDs and other market schemes, who will not have connection offers in time for the auction window. This will require DESNZ and LCCC to come up with a practical solution.

Mandatory bay sharing?

TOs have flagged concerns about 'significant oversubscription', particularly across battery and solar, against CP30 and that this could lead to later offers for 'needed' projects. DESNZ and Ofgem are considering – investors have argued there will be significant attrition once offers are out and the challenges for network design at a substation could be reduced by mandatory bay sharing.

Confirmation of cancellation charges

NESO has confirmed that customers that don't accept their Gate 2 offer and move to Gate 1 will have their securities returned and will not be subject to any cancellation charges (as per the Connection and Use of System Code). Those who terminate before they get their new offer will be subject to the usual cancellation charges.

Managing the system moving forward

We are awaiting a date for the first ongoing application window. Details as to how projects that drop out of the queue will be replaced by Gate 1 projects are not yet clear.

And in light of the Local Power Plan, how DNOs will treat sub-5 MW projects in queue order is also important. Imagine there's 5 MW headroom at a substation and the next project in the connection queue is 50 MW; that project will have to wait for reinforcement works – but a pragmatic approach would be to get on with connecting a new sub-5 MW project in the meantime.

The yin to the yang of connections reform

Alongside all of this we have Ofgem's 'End-to-End' review looking what standards networks should meet in delivering high-quality, ambitious offers and in delivering connections on time. This will be key to the overall success of the connections process.

Maintaining a collaborative approach is key

Connections reform is perhaps the most important and radical reform process in the government's Clean Power Mission. While there is understandable frustration from investors on the delays, a collaborative 'whole-industry' approach is now required to get this over the line and to enable the industry to get back to investing in delivering the exciting clean power projects we all want to see.