Britain’s energy regulator, Ofgem, has given provisional approval to an initial £24 billion investment package to modernise the UK’s gas and electricity networks between 2026 and 2031.
More than £15 billion is earmarked for gas transmission and distribution, while £8.9 billion will be devoted to upgrading the high-voltage electricity grid—with an extra £1.3 billion reserved for ready-to-go projects. This marks the largest expansion of the electricity network in the UK since the 1960s
The plan is expected to support around 80 major infrastructure projects, including the construction of approximately 4,400 km of overhead lines and 3,500 km of new circuits, connecting up to 126 GW of clean power by 2030—enough to power millions of homes with renewable energy
To fund the upgrades, household energy bills are projected to rise by £104 annually by 2031—comprising roughly £30 for gas and £74 for electricity. Ofgem estimates that without this investment, bills would climb even further, by as much as £30 more per year
Ofgem’s Chief Executive, Jonathan Brearley, emphasised that major infrastructure investment is crucial to making the energy system more resilient to volatile global gas markets. “Doing nothing is not an option and will ultimately cost consumers more,” he stated.
The watchdog has also imposed strict cost controls and capped private equity returns at 6 percent, up from the previous cap of 4.55 percent. A final determination on return rates and other details is expected by December 2025 following ongoing consultation.
