Household energy bills in the UK are set to rise to fund a significant £28 billion investment into the nation's energy networks. Ofgem, the energy regulator, has sanctioned this funding as part of a five-year strategy to advance electricity and gas grids. The money will primarily be used for maintaining gas infrastructure and bolstering the electricity transmission network. Although the investment is projected to add £108 to consumer energy bills by 2031, it is anticipated that people will ultimately benefit from savings of around £80, resulting in a net increase of about £30.
Currently, companies managing energy networks, such as power lines, cables, and gas pipes, operate separately from suppliers and hold monopolies in various regions. This plan outlines their mandate to deliver a safe and reliable energy supply while adhering to price controls set for the next five years. Jonathan Brearley, Ofgem's Chief Executive, emphasized that the investment would ensure that Britain's energy network remains among the world's safest, most secure, and resilient.
In an interview with BBC's Breakfast programme, Brearley highlighted the UK's need to lessen its reliance on gas, proposing a diversification of energy sources to protect consumers' bills in the long term. Of the anticipated £108 increase to energy bills, £48 will be attributed to gas and £60 to electricity. However, Ofgem projects the investment to yield about £80 worth of cost reductions, including saving approximately £50 through grid expansion alone.
Brearley noted that the increase would be gradual, accounting for a 2–3% rise in bills starting in April, with steady growth over the five-year span. The improvement would also eliminate inefficiencies, such as offshore wind farms being compensated for power that the current grid cannot accommodate. Ahead of the announcement, Keith Anderson, Scottish Power's CEO, described this initiative as the largest investment wave in electricity infrastructure since the 1950s, intended to prepare the system for the 21st century.
National Gas, overseeing Britain's gas transmission network, will receive a portion of this investment. CEO Jon Butterworth has acknowledged the funding's importance in securing the country's energy future, maintaining industrial competitiveness, and achieving green energy goals. Greenpeace UK's climate adviser, Charlie Kronick, supported the upgrades but stressed the need for responsible spending and regulation to ensure genuine value and protect consumers.
The announcement aligns with a recent government budget commitment to remove specific costs from typical annual energy bills, potentially saving households about £150.