By Adam Whittaker

U.K. energy regulator Ofgem provisionally approved an $33.24 billion five-year investment program in the country's gas and electricity grid, saying it expects network charges will need to increase to cover the costs.

Ofgem issued its draft determinations Tuesday for the five-year period from April 1, 2026 to March 31, 2031 and set out its investment and price control framework.

The watchdog said it has provisionally allowed for 24.2 billion pounds ($33.24 billion) of investment over the period. This is 26% lower than the spending plans proposed by U.K. energy companies but could rise once additional details and specific network investment needs are understood, it said.

Ofgem expects household network charges, which make up about a fifth of the average annual bill to rise by an average of 104 pounds to 324 pounds by March 2031.

However, this doesn't necessarily mean consumers' bills will rise by that amount as more renewable electricity generation will lower wholesale electricity costs and the investment plan will protect households from volatile gas prices, Ofgem said.

In response, SSE said the plan doesn't go far enough to deliver the investment needed to lower bills. Energy-infrastructure company National Grid said it would review the details of the plan to assess whether it delivers an investable overall financial package.

Write to Adam Whittaker at adam.whittaker@wsj.com

(END) Dow Jones Newswires

July 01, 2025 04:09 ET (08:09 GMT)

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