UK Law and Practice Contributed by: Tom Sprange KC, Andrea Stauber, Martina Antosova and Lucy Pearson, King & Spalding International LLP
King & Spalding International LLP 8 Bishopsgate London EC2N 4BQ UK
Tel: +44 207 551 7500 Fax: +44 207 551 7575 Email: astauber@kslaw.com Web: www.kslaw.com
1. Structure and Ownership of the Power Industry 1.1 Law Governing the Structure and Ownership of the Power Industry The UK has a fully liberalised and privatised electric- ity market, meaning that the companies responsible for the generation, transmission, distribution and sale of the UK’s electricity are all in the private sector. However, this is set to change. On 25 July 2024, the government introduced the Great British Energy Bill into Parliament – the aim of which was to establish a new, public-owned company (Great British Energy) that would deliver cleaner, more secure energy to the British public and would work closely with the private sector, devolved governments, local authorities and community energy groups to promote, invest, own and manage clean energy projects. On 15 May 2025, the Great British Energy Act received royal assent after passing through Parliament and came into force on the same day. Great British Energy is backed by GBP8.3 billion between July 2025 and July 2029, and the govern- ment has set a target for Great British Energy to become self-funded from its investment in clean ener- gy projects by 2030. In December 2025, Great Brit- ish Energy published its first strategic five-year plan. Great British Energy plans to operate as a developer and equity investor, delivering at least 15 GW of clean energy generation and storage assets, GBP15 billion of mobilised private finance, support over 1,000 local and community energy projects, support over 10,000 jobs, and create an income-generating portfolio.
Structure and System of Ownership Currently, England, Wales and Scotland (Great Brit- ain, Britain, or GB) have a single integrated energy market for both electricity and natural gas. Following a joint consultation between Ofgem and the now-dis- solved Department for Business, Energy and Indus- trial Strategy (BEIS) in 2021 and Ofgem’s decision in 2022 to create an independent system operator (FSO) to deliver a new electricity transmission net- work planning output, on 1 October 2024, the National Energy System Operator (NESO) was established and replaced the National Grid Electricity System Operator (National Grid ESO) as the electricity system operator for Great Britain. Unlike National Grid ESO, which was part of National Grid plc, NESO is an independent public corporation overseeing Great Britain’s electric- ity and gas networks. NESO’s focus is on ensuring that Great Britain’s energy system is secure, afford- able and amenable to a sustainable future. The power industry in Northern Ireland is separate to and distinct from the industry in Great Britain. This is because energy in Northern Ireland (other than nuclear energy) is a devolved power, meaning the Northern Ireland Assembly – rather than the UK Parliament – has legislative control. The electricity industry oper- ates a single wholesale market across the whole of the island of Ireland, known as the Single Electricity Market (SEM). The operation of this single wholesale market requires the physical connection of the North- ern Ireland grid to that in the Republic of Ireland. This is facilitated by the Single Electricity Market Operator (SEMO), which is a contractual joint venture between the two system operators – System Operator for
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