Delays to Britain’s electricity grid upgrades could push constraint costs to as much as £7.8 billion a year by 2030, the National Audit Office has warned.
The watchdog says the £70 billion transmission upgrade programme is critical to keeping consumer costs under control as more renewable generation connects to the system.
Gareth Davies, head of the NAO, said: “Value for money now depends on delivery. Failure to implement these necessary grid upgrades will hamper economic growth as well as increase consumer bills.”
Constraint costs arise when the grid cannot carry enough electricity from where it is generated to where it is needed. NESO then has to intervene to keep the system balanced, often paying wind farms to reduce output while bringing gas-fired generation onto the system elsewhere.
Those costs reached £1.9 billion in 2025/26 and are ultimately recovered through consumer bills. The NAO says they could rise to £7.8 billion by 2030 without faster delivery of new transmission capacity.
Ofgem estimates around £70 billion of investment is needed in the grid between 2025 and 2031.
That is expected to add around £60 to annual network charges by 2030 but could still leave households around £30 better off overall compared with the cost of failing to accelerate the upgrades.
The problem is delivery. NESO identified more than 80 projects as necessary in its 2024 Clean Power advice, with 64 currently under way.
Most remain at an early stage and many are not expected to connect by the dates NESO originally judged optimal for limiting constraint costs.
NESO identified three projects that needed to be accelerated to meet Clean Power 2030 and another eight where faster delivery would reduce costs.
The NAO says there has so far been no significant acceleration across those projects.
It also warns that many schemes were selected because they were already in development rather than through a full whole-system assessment.
Pressure is also building from new connections, as the proportion of projects receiving a connection offer for the date requested fell from 64% in 2019/20 to just 16% in 2023/24.
DESNZ, Ofgem and NESO have begun tackling planning, supply-chain and skills barriers but the NAO says stronger oversight and greater transparency will be needed.
Mr Davies added: “The planned upgrades of the electricity grid will test systems not designed for activity at this pace or scale.”
