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UK Regulator Ofgem Proposes Fees for BESS Grid Connections
UK energy regulator Ofgem is considering a new financial commitment, the 'Oversubscribed Technologies Commitment Fee' (OTCF), for large-scale Battery Energy Storage Systems (BESS) awaiting grid connection. This aims to reduce the extensive project queue, as the current pipeline significantly exceeds estimated capacity needs for 2030 and 2035. The fee, starting at GBP 3,000 per MW and potentially rising to GBP 25,000 per MW, is expected to be implemented by July 2027. Ofgem is currently consulting stakeholders on this proposal.
Ofgem, the energy regulator in the UK, is considering the introduction of a new financial commitment for large-scale Battery Energy Storage Systems (BESS) awaiting grid connection in Great Britain. Ofgem describes this measure as a 'major intervention' aimed at addressing the significant oversupply of projects in the connection queue.
The proposed 'Oversubscribed Technologies Commitment Fee' (OTCF) would require BESS operators to provide a financial security. The value of this security would be linked to their proposed capacity, allowing them to retain their position in the queue. This initiative follows a previous reform process where grid operator NESO already cleared 40% of grid-level battery capacity. Despite this, 83 GW of projects remain prioritized in the queue, in addition to the 7 GW of operational capacity.
According to NESO's estimates, 24 GW of battery capacity is required by 2030 and 29 GW by 2035 to meet the UK government's clean power targets. If all projects currently in the queue were to be built, the total capacity would significantly exceed these projections, by 14.8 GW and 61.7 GW respectively.
The fee would start at GBP 3,000 per MW and could increase to a maximum of GBP 25,000 per MW if the oversubscription persists. This measure is expected to come into force around July 2027 through a modification to Great Britain's connection and use of system code (CUSC), known as CMP470. This proposal was initially put forward by BESS developer Field Energy in March 2026.
Ofgem is inviting industry stakeholders to submit their views on the proposal by October 1st. This provides an opportunity for developers and other parties to comment on the justification of the new fee structure, its impact assessment, and any implementation concerns. Potential modifications under consideration include capping the commitment fee, removing it once project construction begins, and reviewing exemptions for certain co-located projects.
Source: pv magazine
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Talk to Oranje-Eco →This article is an Oranje-Eco summary of a report by pv magazine. Read the original: pv magazine.
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