UK Trends and Developments Contributed by: Andrea Stauber, Martina Antosova, Medhavi Singh and Sadyant Sasiprabhu, King & Spalding International LLP
The NSIP threshold for onshore energy generation projects has also been increased from 50 MW to 100 MW, effective from January 2026. The Act enshrines in law a duty on Ofgem to operate a cap-and-floor funding scheme for Long-Duration Energy Storage (LDES). It also grants new powers to prioritise clean power projects for grid connections and introduces a scheme to reduce energy bills by up to GBP2,500 for households living in close proximity to new electricity transmission infrastructure. Grid connection reform : “ first ready and needed , first connected ” Alongside planning reform, the overhaul of the elec- tricity grid connection process has been the other fundamental systemic change affecting the UK ener- gy sector. The scale of the problem was extraordi- nary: the national grid connection queue had grown to over 700 GW as the old “first come, first served” model allowed speculative and non-viable projects to occupy connection slots for years. On 15 April 2025, Ofgem approved the National Energy System Opera- tor’s (NESO’s) TMO4+ reform proposals, replacing the existing system with a “first ready and needed, first connected” process. On 8 December 2025, NESO announced the outcome: of approximately 3,000 project applications assessed, a pipeline of 238 GW was retained for development to 2035. The reforms are estimated to have the potential to unlock GBP40 billion of investment per year. The connection reforms have also had a pronounced effect on emerging demand sectors. More than 100 GW of large-scale demand projects remained in the pipeline but had their connection timescales extended beyond 2030, prompting the government in March 2026 to launch a further consultation on accelerating connections using new powers under the Planning and Infrastructure Act 2025. That consultation closed on 15 April 2026, and the government is expected to implement the proposed queue management and prioritisation measures ahead of NESO’s next gated application window later in 2026. Four key pillars of UK net zero policy Wind The UK is the windiest country in Europe, according to a report by international energy company Equinor
published in the Financial Times , and the seas around its coastline are even windier. Wind energy is therefore a key element of the delivery of the UK’s Net Zero Target. With regard to the UK offshore wind market, 49.2 TWh of green electricity was produced by offshore wind in 2024, with offshore wind energy making up 18% of total UK electricity needs. The Crown Estate Offshore Wind Report 2024 recorded 52 wind farms – either operating or under construction – in UK waters. Another five have secured a Contract for Difference, which is the bedrock of offshore wind project develop- ment in the UK. The aforementioned British Energy Security Strategy established the Offshore Wind Acceleration Taskforce to focus on streamlining the consenting process for new offshore wind farms. This included planning reforms to cut the approval time for new offshore wind farms from four years to one. In the 2023 Spring Budget, the former UK govern- ment introduced a series of capital allowance meas- ures that aim to benefit offshore wind projects – for example, offering 100% capital allowances on plant and machinery investment until March 2026, which has since Autumn 2023 been made permanent. Turning to dry land, onshore wind farms generated 35.1 TWh of electricity in 2023, amounting to 24.2% of overall renewable electricity and 12.3% of total elec- tricity generated in the UK. Although the former UK government recognised that “onshore wind is an effi- cient, cheap and widely supported technology”, there were few concrete proposals or targets in its Power- ing Up Britain agenda. Following a public consultation between May and July 2023, the former UK govern- ment recognised the cost benefits and efficiency of renewable energy, promising that communities will benefit from hosting onshore wind facilities. Propo- nents of onshore wind power have pointed out that it is one of the cheapest forms of renewable energy and necessary in order for the UK to meet its target of net zero emissions by 2050. With the change in government in July 2024, such greater support has since been forthcoming. Within
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