Asked by: Stephen Kerr (Conservative - Stirling)
Question to the Department for Business, Energy and Industrial Strategy:
To ask the Secretary of State for Business, Energy and Industrial Strategy, what steps his Department is taking to develop local energy distribution networks to respond to a potential increase in domestic electricity consumption.
Answered by Chris Skidmore
Electricity distribution networks are regulated by the independent energy regulator, Ofgem, and, by law, network regulation must be carried out independently of Government. Under the existing regulatory framework, distribution network operators are allowed to increase capacity on their networks to accommodate expected growth in demand from domestic electricity consumption.
Energy networks require significant investment in order to ensure that Great Britain has a secure, dynamic energy system that is fit for the challenges of the future. BEIS estimates that between 2010 and 2017 £35bn has been invested to upgrade, reinforce and extend the electricity networks (both transmission and distribution) and a further £14bn may need to be invested between by 2020. Ofgem's RIIO 2 price control will set out the pathway for investment in our energy networks through the mid-2020s.
Government expects network companies and regulators to act in the best interests of consumers including in relation to more active system management as per the Government and Ofgem’s Smart Systems and Flexibility Plan. We are already seeing distribution network operators manage their systems more actively, and make more innovative use of data and smart technologies. For example, all six DNOs in Great Britain have now committed to open all significant network reinforcement to competition with flexibility services.