Ofgem launch consultation document for £22bn investment
Written by Susan Care
Posted on July 17, 2012
Ofgem, the regulator for the gas and electricity markets, have released a consultation document for £22bn investment plans to upgrade and renew Britain’s gas and high voltage electricity distribution networks. £5bn of the funding will be held back by Ofgem and only released when there is “a demonstrable need for the infrastructure” and that these figures had been calculated after reducing the funding requests of the grid companies by 20%.
Around £15bn of the investment will be targeted at the high voltage electricity networks in England and Wales & high pressure gas network across Britain and would fund new sub-sea electricity cable links between England/Wales and Scotland. Ofgem estimates that this will create nearly 7000 new jobs in the construction supply chain.
The remaining £7bn of the investment will be aimed at the low pressure gas network, funding maintenance and replacement of gas mains but also enabling some 80,000 households to be connected to the gas network.
Ofgem estimates that household bills would rise by an average of £7 in 2013 increasing to £15 by 2021 which would be the end of the price control period.
Though any increase in utility bills is unwelcome, this represents less than 1% of the average gas and electricity bill, a figure that could easily be recovered by ensuring you are with the right supplier. The moneymaxim team have been looking at what’s new in the marketplace – report here.