UK Grid Reform Spurs Investment but Delays Persist
The UK’s latest grid connection reforms are being welcomed by investors, but significant barriers remain, according to a new survey by independent distribution network operator Aurora Utilities.
The survey of 800 senior decision-makers across renewables, property, and infrastructure comes as the National Energy System Operator (NESO) issues the first wave of Gate 2 grid connection offers. While 68% of respondents view the reform, including Gate 2 and TMO4+, as an investment opportunity, concerns remain over whether projects will actually reach completion.
Seventy-four per cent expressed confidence that the new Gate 2 process would reduce delays, yet 46% warned that larger players with deeper resources are most likely to benefit. “Gate 2 disproportionately favours the big players – they’re the only ones with deep enough pockets to roll the dice,” one industry leader commented.
Survey results reveal lingering scepticism: 17% are not confident delays will be reduced, and 18% cited implementation challenges that could postpone returns. Supply chain issues were flagged as a major risk, with 80% concerned that equipment shortages could push project timelines into 2026.
Despite these challenges, investors remain committed: 60% have pledged between £50 million and £250 million over the next two years to build infrastructure requiring grid connections. Yet a significant proportion anticipate projects falling out of the queue, with 25% expecting to lose 16–20% of their schemes during the Gate 2 process.
Simon Reilly, CEO of Aurora Utilities, said: “Gate 2 is credible in theory, but its value will be proven in delivery, timetable discipline, and consistent decision-making. Investors demand proof that administrative progress converts into construction certainty.”
Financial exposure from connection delays remains substantial. Almost half of respondents estimate delays over the next 18 months could cost their organisations £50 million to £1 billion, while 30% highlighted impacts between £100 million and £750 million.
Looking ahead to 2026, 44% cited queue management changes as the factor most likely to affect plans, closely followed by capacity market rules (43%) and carbon pricing adjustments (42%). Costs remain a critical consideration, with 44% warning that high connection or upgrade fees could halt projects even under Gate 2 reforms.
Mr Reilly concluded: “The industry is primed to invest, but reform must deliver on the ground. Gate 2 can reset the system, but it will only succeed if it converts queue clearing into tangible construction outcomes rather than replacing backlog with bureaucracy.”
