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SP Energy Networks sets out its £3.3bn plan to deliver a green future 

01/12/2021

  • SP Energy Networks has published its final plans for £3.3bn of investment to support the delivery of the UK’s Net Zero targets
  • The multi-billion pound investment will help to ensure that no community is left behind in the transition to a low carbon future
  • Proposals include critical network upgrades to support the roll-out of 670,000 electric vehicles and 370,000 heat pumps, and to connect over 6GW of local new renewable power
  • To deliver this plan, the network operator would recruit for over 1,100 roles across Scotland, England and Wales
  • And local communities are set to benefit from a £30m Net Zero Fund to support innovative low carbon community projects and to accelerate community-based energy solutions

SP Energy Networks has today, 1 December 2021, submitted its final RIIO-ED2 Business Plan to the energy regulator, Ofgem, setting out £3.3bn of investment in its electricity distribution network that’s needed to help get the UK fit for a green future. 

Running from 2023 to 2028, the plan sets out SP Energy Networks’ vision for a network that can meet the challenge of Net Zero across more than 100,000km of network and 30,000 substations and will benefit more than 3.5m homes and businesses across Scotland, England, and Wales. 

Electricity will be at the heart of the Net Zero future, as low carbon technologies like electric vehicles and heat pumps become part of daily life and as more renewable energy generation is connected into the grid than ever before. In its role as a network operator, SP Energy Networks will help facilitate these much-needed changes.

The only Distribution Network Operator to serve parts of England, Scotland and Wales, SP Energy Networks recognises Net Zero will not happen at the same pace across every community and its RIIO-ED2 plan is designed to enable each region’s individual ambitions. The plan will also support increased electricity resilience, as communities’ dependence on electricity increases.

Frank Mitchell, CEO of SP Energy Networks said: “The role of our networks in achieving Net Zero cannot be understated – we forecast that up to 1.8 million electric vehicles, 1.1 million heat pumps and more than three times as much distributed generation will be supported by our networks by the end of this decade."

“The only way this can be achieved is by delivering our RIIO-ED2 plan, one of the most innovative and ambitious plans the UK has seen in recent years.”

As the pace of decarbonisation increases, this investment will provide the capacity, flexibility and technology across the electricity network that will be essential for everyone to access new green solutions safely, efficiently and reliably.

And this multi-billion pound investment will deliver new green jobs, economic growth, and environmental benefits, as it enables the UK’s path to Net Zero by supporting a just transition in the communities that SP Energy Networks serves for just 30p per day.

To help deliver this mammoth task, SP Energy Networks plans to recruit more than 1,100 green jobs, with thousands more indirect jobs supported over the five years.

Communities are also set to share in a proposed £30 million Distribution Net Zero fund. This will support innovative, low-carbon project proposals to enable communities to realise their ambitions. 

Frank Mitchell added: “Without this plan, we run the risk of leaving people behind as we move to a low carbon economy. That’s something that absolutely cannot happen.

"We have engaged with more than 19,000 customers and stakeholders to shape the 100 commitments outlined in our plan, so we can make sure that our networks deliver for all of our communities as we enable the path to Net Zero. 

“Our customers want us to be bold as we reimagine the role of the electricity network, the services we provide, and the capabilities of our business. We must match their ambitions, alongside those of the devolved governments and major regional authorities we serve, which have set out their visions to achieve Net Zero and the targets newly agreed at COP26.

“But we can’t do this by ourselves. To deliver what our communities want, we need the support of our regulator, Ofgem, to modernise, be more agile, and develop a framework that is fit for delivering Net Zero.”

The network operator is responsible for the operation and management of the distribution electricity network across Central and Southern Scotland, North Wales, Merseyside, Cheshire and North Shropshire.

SP Energy Networks now awaits the draft decision of Ofgem on its ED2 investment plans in summer 2022, with final determinations then expected at the end of 2022.

The summary and benefits of SP Energy Networks’ plan is below and the full plan is available at www.spenergynetworks.co.uk/RIIOED2 

-    developing a network that’s ready for Net Zero by continuing to adapt the world-class network to be more resilient and more reliable, using innovative, flexible, and efficient solutions. This will enable:

  • Net Zero ambitions by connecting 670,000 electric vehicles and 370,000 heat pumps; 
  • the realisation of £370m of direct benefits for customers and communities through the DSO (Distribution System Operator) Strategy; and
  • a digital Connections Strategy which could allow £15m of savings to connections customers each year.

-    being the trusted partner for customers, communities, and stakeholders by engaging more with customers and communities, supporting them by offering enhanced and tailored services, and going further for vulnerable customers through:

  • maintaining industry-leading customer satisfaction performance and ambitions – increasing customer satisfaction scores to 9.4/10;
  • providing support services to more customers than ever and delivering £62.5m in social benefits; and
  • a proposed Distribution Net Zero Fund providing £30m of funding, with 25% allocated to kick-start community-led energy schemes.

-    readying the business for a digital and sustainable future by building a Net Zero workforce. Creating jobs, upskilling our people, and driving sustainability in our business and supply chain. This will embed digitalisation and unlock the value of data by:

  • reducing the carbon footprint by 37.8% in RIIO-ED2 and achieving Net Zero carbon by 2035;
  • creating over 400 new jobs and recruiting over 700 new employees to replace retirees; and
  • embedding new digital approaches and process redesigns to save customers over £36m.
     

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