ENA Connections Blog: Ofgem publishes its decision on vital connections reform

It’s certainly been a busy time for connections. Ofgem recently announced its decision on the proposed TMO4+ code modifications. Now, after months of consultations and preparation, the long-awaited queue reforms have been approved for implementation.

These urgent process reforms will ensure that feasible projects needed to achieve the government’s Clean Power 2030 Action Plan can progress through the queue on a “first ready and needed, first connected” basis. Over the years, networks have been connecting customers at pace, however, the length of the queue has presented an enormous challenge.

Since April 2024, networks have delivered 6.15 GW of connections. However, the queue remains the biggest barrier to customer connections – now at 723GW of generation projects - and remains dominated by renewables (352GW, 46% of the queue) and storage (268GW, 35% of the queue) that far exceed what we need to reach net zero targets. With TMO4+, networks will soon be able to connect vital and viable projects quicker.

We have a ‘go’

As mentioned, Ofgem published its decision on the proposed grid code modifications CMP435 and 434 and the three associated methodologies on 15 April, approving the implementation of the new TMO4+ connections framework.

As echoed by our Chief Executive, Lawrence Slade, in a statement, the decision moves us forward towards a cleaner, more efficient connections queue. The government has set an ambitious clean power by 2030 target, and implementing a first ready, first needed, first connected queue will help get us there. 

There have been lots of discussions on the decision already, but I wanted to make sure you didn’t miss the following:

• Ofgem has recommended that NESO protect projects that have obtained planning consent and are due to connect in 2027. If NESO approves, qualifying projects will have their queue position protected, ensuring investor confidence.
• Ofgem have approved the original proposal for CMP435, and have approved CMP 434 with WACM2.
• Ofgem have reversed on their minded to position of approving a WACM which would introduce a “pause” and have instead approved the original proposal, however, they have asked NESO to still publish the information which would have been published during a pause period.

As indicated last time, distribution operators have also published their decision on a common approach to what happens when a project does not meet ‘Gate 2’ entry requirements.

In a nutshell, a project may choose to withdraw from the queue if the developer does not meet the ‘Gate 2’ criteria. Alternatively, they will receive an indicative connection date and point of connection through a distribution ‘Gate 1’. In the latter case, the existing connection agreement will be varied to provide an indicative date and point of connection at both transmission and distribution levels. Customers can then reapply to the DNO and will be put through a gated window once they meet the ‘Gate 2’ criteria.

And now the work starts

Well, the pace of change in connections is showing no signs of slowing down. Now that the TMO4+ reforms are confirmed, NESO, Ofgem and the networks will work together to implement the new framework, re-forming the queue and accelerating customer connections.

• The decision has triggered a standstill period of 56 days for licence changes, lasting until the 10^th of June.
• NESO will be issuing updated final versions of the methodologies shortly as requested in the Ofgem decision.
• Customers with existing contracts will need to submit evidence to show they meet the new ‘readiness criteria’ and will be assessed for strategic alignment.
  • To help applicants with their readiness declaration, NESO has published guidance on how to prepare to submit evidence and will host a webinar to take customers through it in more detail.
  • Distribution Network Operators will be opening for embedded customers to submit their gate 2 evidence in May; the opening date is to be published shortly.
  • NESO will soon make all customers aware when the ‘Gate 2’ window for transmission customers opens.
• The newly formed queue, and clarity on which projects have achieved ‘Gate 2’ and which will be receiving ‘Gate 1’ offers at transmission and distribution will be published in September.
• New offers for ‘Gate 2’ distribution projects and transmission are expected to start being issued by the end of this year and continue into early next year, respectively.

I would also note that if any developers are looking to exit the queue at this stage, they should notify their distribution network operator. Projects will have the opportunity to exit the queue in a one-off process before the new queue goes live. There is no cancellation charge for opting out during this period, so I’d encourage customers to notify their network operator as soon as possible.

Linked to the approval of TMO4+, make sure to join our webinar on 8 May to learn more about the proposed changes to Distribution Queue Management processes to further harmonise transmission and distribution queue management, and to align with the new TMO4+ framework. This webinar is relevant to developers and connections customers that are connecting to distribution networks, as well as other network customers, planning bodies and local authorities.

As we transition into this new phase of connections reform, we will review the types of industry connections data we publish to ensure it remains relevant to customers.

Make sure to look out for our next newsletter, and sign up if you haven't already, as we’ll soon be announcing more stakeholder engagement events over the coming months.