Octopus Energy is reportedly exploring the possibility of constructing its own electricity pylons, signaling a potential challenge to the National Grid’s long-standing control over transmission infrastructure in England and Wales.
While it’s best known as an energy supplier, Octopus has been branching out its business to offer a whole host of other services. This includes an electric vehicle leasing company, an EV charging network, and a plethora of renewable generation sites – it seems that connecting the latter to the grid is the reason behind its latest business venture.
According to The Telegraph, Greg Jackson, CEO of Octopus, has confirmed that the company is in discussion with Ofgem regarding the opening up of the planning and building process for the power grid to competitive entities. Octopus believes that it can deliver sections of the high-voltage transmission network, crucial to the electricity system, with greater speed and efficiency than the National Grid, thereby accelerating the deployment of clean energy sources.
Renewable energy developers have been dissatisfied with National Grid’s pace of expansion, with the slow build out of new infrastructure forcing National Grid ESO to give connection dates nearly 10 years into the future for some developers. While National Grid ESO has been working on mechanisms to speed up the connections queue, including offering an amnesty to projects that wish to leave the queue, Octopus believes the problem ultimately lies at the feet of National Grid.
Octopus believes that it can deliver sections of the high-voltage transmission network with greater speed and efficiency than the National Grid, thereby accelerating the deployment of clean energy sources.
This potential shift could mark the end of the National Grid’s 30-year exclusive hold on transmission infrastructure, although that change was expected with the 2023 Energy Act, which should introduce competition in onshore transmission for the first time.
Investment in the grid
The International Energy Agency has already noted that the electricity grid will need around $600 billion worth of investment globally in order to get it ready for the move to net zero. That follows what the IEA called a ‘decade of stagnation’, and National Grid has already acknowledged that it will need to construct thousands of new pylons to accommodate the increased demand for electricity that comes with the electrification of heat and transport.
Octopus’s interest in electricity infrastructure is not entirely new, as evidenced by its acquisition of Eclipse Power Networks in 2021. Eclipse, based in Buckingham, has so far been focused on small-scale, local power distribution networks. However, Jackson is keen to extend Eclipse’s role to encompass transmission infrastructure as well.
Inspiration for Octopus’s ambitions comes from Sterlite Power, an Indian energy company known for its use of advanced computer software in India and Brazil to design power grid projects efficiently. This approach aims to minimise delays and opposition by carefully planning projects to avoid complex planning permission zones and areas with significant potential objections.
In a conversation with The Telegraph, Jackson suggested that increased competition in Britain could spur innovative solutions to local opposition, potentially leading to fewer pylons being constructed. He believes that exploring various construction technologies and routes could lead to more community-accepted infrastructure projects.