Question

To ask the Secretary of State for Energy and Climate Change, pursuant to the Answer of 19 June 2014, Official Report, column 1258, on energy security, on which process he calculated that there has been £45 billion of electricity investment since 2010.

The estimate of more than £45bn of electricity infrastructure investment between 2010 and 2013 is calculated by DECC based on modelling consistent with the EMR Delivery Plan.

The modelling suggests that since 2010, over £30bn has been invested in electricity generation capacity, principally in renewable technologies. In addition, since 2010, more than £16bn of investment has been made in electricity transmission and distribution.

Generation capacity investment levels are determined by multiplying capacity changes by a technology specific capital cost per unit of capacity value, which varies over time. A project's total investment cost is profiled over its construction lifetime, with total annual investment levels reflecting the sum of investment in that year across all technology types. All data on costs and profiles is taken from DECC's Electricity Generation Costs dataset.

Onshore and offshore transmission network investment estimates come from National Grid's networks module that has been added to DECC's dispatch model as part of the EMR Delivery Plan analysis.1 Network investment for onshore transmission owners is based on additions to network owners' regulated asset value under the price control periods consistent with National Grid's Gone Green scenario. From 2013 onwards Gone Green investment estimates are adjusted for different uptake of technologies in DECC's dispatch modelling.

Network investment for offshore transmission is calculated by using a relevant cost associated with Offshore Transmission Owners (OFTOs) based on an average cost per kW for known projects. This is multiplied by offshore wind capacity built.

Investment in distribution networks is based on additions to network owners' regulated asset value under the DPCR5 price control period.

Further detail on DECC's Electricity Generation Costs is available here: https://www.gov.uk/government/publications/decc-electricity-generation-costs-2013

[1] Find further detail in the National Grid report: https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/267614/Annex_D_-_National_Grid_EMR_Report.pdf