The National Grid will no longer be responsible for keeping the country’s electricity and gas flowing – in the biggest overhaul of the UK’s energy infrastructure since the company was privatised 30 years ago.
The government has announced the division of The National Grid overseeing supply and demand across the country will be returned to public control by 2024.
National Grid Electricity System Operator (NGESO) – which is a separate legal entity from the FTSE 100 company – will be effectively nationalised and turned into a Future System Operator (FSO).
The FSO will have responsibility for planning and managing energy distribution, with a focus on the challenges posed by decarbonisation.
This will give ministers greater powers to oversee the system as the UK aims to secure energy independence following Russia’s invasion of Ukraine.
The FSO will also oversee the integration of technologies such as hydrogen and carbon capture and storage into existing gas and electricity systems.
It is hoped the move could keep costs down, with household energy bills spiking to nearly £2,000 per year.
The effective nationalisation of the division comes just three years after it was formally separated from the rest of National Grid, albeit within the same corporate group.
National Grid chief executive John Pettigrew said: “We have been working closely with government, industry and the regulator to create an FSO 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.”
Business Secretary Kwasi Kwarteng said: “Our energy system is at a transformative moment. We need fundamental change to ensure we match the scale of our net zero ambitions