Electricity supply will fall under a new authority
National Grid is to be brought partly back into public ownership as the government forms a new authority to oversee the electricity system and monitor climate targets.
It will play a critical role in coordinating and planning the network as the country embraces more electric vehicles, and electricity-generated fuel for homes and businesses, much of which will come from wind farms and other renewable sources.
The new Future System Operator (FSO) will “help to transform Great Britain’s energy system and cut customers’ energy bills”, said Jonathan Brearley, chief executive of energy regulator Ofgem. It will also take over some of National Grid’s gas functions.
The government has said nothing about the cost of the exercise, apart from confirming that National Grid will be “appropriately compensated” for the parts of its business moved to the new authority.
It will be a “public corporation with operational independence from government”, licensed and regulated by Ofgem and funded by consumers.
National Grid CEO John Pettigrew said: “We have been working closely with Government, industry and the regulator to create a Future System Operator that enables long-term holistic thinking, drives progress towards net-zero, and lays the foundations for the regulatory reform necessary to deliver a clean, fair and affordable energy transition.”
The Government is expected to announce its new energy strategy on Thursday when it is likely to make a commitment to more wind farms and nuclear power stations.