New tool to drive connections queue progress proposed

We’re proposing a new Connection and Use of System Code (CUSC) modification to introduce a Progression Commitment Fee that will support the future connections queue. The proposed fee will work alongside the connections reforms currently under consideration by the energy regulator, Ofgem.

Following industry feedback in October last year, we’ve revised our initial proposal to better balance concerns raised with a requirement to motivate projects to progress through the connections queue or to exit at the earliest possible opportunity.

How it works

The proposed fee will not immediately be applicable. Instead, it will be subject to a defined activation trigger. If activated, our proposal would mean generation project developers would have a fee payable on termination or reduction in capacity, with the fee increasing over time.

Under the reformed connections process, the proposed fee would provide an additional incentive for generation developers to regularly assess the viability of their projects during the period before they submit their planning applications.

The proposed fee would only apply to generation projects that have already progressed through the first stages of the connections process to join the future Gate 2 connections queue, but that had not yet submitted their application for planning consent.

Our proposal is that initially the fee would be equivalent to an additional £2,500/MW for the project and would increase by an additional £2,500/MW every six months, up to £10,000/MW, during the time a project is in the Gate 2 queue without a submitted application for planning consent.

Kayte O'Neill, Chief Operating Officer at NESO

“Ensuring we have effective measures to make connections reform a success is critical to the future of the electricity network. If activated, the proposed Progression Commitment Fee will maintain the impetus for projects to regularly assess the viability of their project – ensuring that viable projects in the connection queue continue to progress and deliver future electricity generation capacity.”

What’s next?

The Progression Commitment Fee code modification has been submitted and will now go through the code review process before final consideration, and approval by the energy regulator Ofgem.

If you have any questions, contact us at [email protected]