The UK’s energy regulator, Ofgem, has announced a five-year plan to improve power supplies. However, the expected £28billion price tag is likely to increase everyone’s bills.
The scheme will improve the gas and electricity transmission networks but add around £108 to household energy bills by 2031. Ofgem says the country will reduce its reliance on imported gas and make wholesale energy cheaper. This could mean the overall increase in energy bills is more like £30 a year.
Why do we need to invest in the energy network?
Separate companies run the energy networks (power lines, cables and gas pipes) and supply energy. Ofgem’s new plan will define how they deliver safe and secure energy supplies and control costs. Changes will include reduced reliance on gas for the country’s energy needs.
Of the £108 added to energy bills, £48 goes to the gas network and £60 to electricity. However, estimated savings of around £80 would reduce the impact. In the 2025 Autumn Budget the government also said it would remove some levies, reducing household energy bills by up to £150.
Price increases will take place gradually over the life of the five-year plan at around 2% to 3% per year. However, Ofgem has also amended the energy price cap which comes into effect in January 2026. This affects people on variable tariffs in England, Wales and Scotland. It will add an extra £3 to the annual energy bill for a ‘typical’ household.
The Department for Energy Security and Net Zero said upgrading the energy network was essential. It will help to keep the lights on and ensure energy security.
What will the extra investment deliver?
The investment plans include £17.8billion for the gas network and £10.3bn to improve the electricity infrastructure. This will upgrade old electricity transmission lines and enable the grid to move power around the network.
Ofgem says the investment would also reduce inefficiencies in the system. For example, we still pay for offshore windfarms, even when switched off because the grid can’t handle the power. It will also provide an electricity transmission network for clean, more affordable and secure energy.
The government’s new energy resilience strategy
The government has announced a new energy resilience strategy for 2026. The intention is to safeguard critical energy infrastructure and protect consumers and businesses from energy disruption.
It says it will tackle issues including climate change, cyber threats, and international conditions.
The move follows a fire at an electrical substation in March 2025 which disrupted operations at Heathrow Airport. This led to the creation of an independent National Energy System Operator (NESO) to review the country’s energy resilience.
In July NESO confirmed that the cause of the fire was probably an electrical fault. It made recommendations to reduce the risk and impact of similar incidents in future. The government says it is making regular infrastructure testing and maintenance a requirement, alongside the planned energy network upgrades. It also intends to improve collaboration between energy operators, emergency services and other providers to restore power quickly.
The Energy Resilience Strategy includes proposals on how government will work with the energy sector and other partners to address risks and challenges.
We hope to see effective solutions to the country’s energy challenges over the next few years.
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