National Infrastructure Commission published its distribution networks study

The National Infrastructure Commission (NIC) published its study, Electricity distribution networks: Creating capacity for the future, on 21 February 2025¹. The study set out 14 recommendations across seven themes, including connections, price controls, skills and flexibility¹. The government subsequently agreed with all 14 recommendations, with what it described as small caveats on implementation process in a small number of cases¹.

The government's response, published on 7 July 2025, states that electricity demand is expected to at least double by 2050, driven by the electrification of heating, transport and industrial processes¹. It also cites the NIC's finding that flexibility can reduce the amount of investment needed in the distribution network by around 15%, with consequential benefits in reducing costs for electricity consumers¹. The government committed in the Clean Power 2030 Action Plan to publish a Clean Flexibility Roadmap in 2025¹.

On reliability, the government agreed that security of supply standards for distribution networks should be reviewed, but said this review may need a more flexible timescale than the NIC's recommended completion by the end of 2028¹. Ofgem has allowed £86m of funding for Worst Served Customers and £149.64m through the Storm Arwen Re-opener, and is reviewing whether the Interruptions Incentive Scheme remains fit for purpose for the next price control period, ED3¹.

The next electricity distribution price control period, ED3, will run from 2028 to 2033¹. Ofgem published the ED3 price control framework on 30 April 2025¹. The National Energy System Operator (NESO) was established on 1 October 2024, and Ofgem wrote to NESO in February 2025 on the scope of the transitional Regional Energy Strategic Plan (RESP)¹.

"Following a thorough review of the study, the government agrees with all 14 recommendations."

The NIC merged with the Infrastructure and Projects Authority on 1 April 2025 to form the National Infrastructure and Service Transformation Authority, a unit within HM Treasury; the government continues to refer to it as the NIC in the response because the study was published before the merger¹.

Why it matters for households

The distribution network is the lower-voltage part of the grid that carries electricity to homes, so its capacity and reliability bear directly on whether a household can add a heat pump, an electric vehicle charger or solar panels without waiting for reinforcement. The government's response frames the study around investment ahead of need, meaning network capacity would be built in anticipation of demand rather than in reaction to it¹. The finding that flexibility can cut the investment needed by around 15% is presented as a route to lower costs for consumers¹. The response also states that expanding the distribution network is critical to building a secure energy system that can bring down bills for households and businesses for good¹. Security of supply standards, which govern how reliably the network must perform and how vulnerable customers are protected, are under review, with the government signalling a longer timetable than the NIC proposed¹. Regional Energy Strategic Plans are intended to improve planning and data across the sector, with local authorities given structured ways to contribute¹.

What happens next

A public consultation on draft transitional RESP outputs is scheduled for September 2025, with final transitional RESP outputs in January 2026¹. A Sector Specific Methodology Decision is expected in spring 2026, and ED3 begins on 1 April 2028¹. The full review of security of supply standards should be completed by the end of 2028, though the government has said this may need a more flexible timescale¹.

Sources1 cited

1. Electricity Distribution Networks Study: government response (accessible webpage) - GOV.UK, gov.uk