Ofgem has outlined a proposal for a £5-8 billion Advanced Procurement Mechanism (APM) aimed at accelerating Britain's clean energy infrastructure development while managing costs and minimizing delays. The regulator stated that the mechanism would allow energy transmission owners to purchase essential materials like cables, switchgear, and steel years ahead of project finalization, ensuring critical equipment is ready when planning approvals are granted.
Akshay Kaul, director general of infrastructure at Ofgem, said, “The race is on to meet the Government's 2030 clean power target, and we are determined to clear the way for trailblazing projects to drive forward.” He added, “Across the world, many countries are stepping up their investment in clean energy at the same time, putting unprecedented pressure on the supply chain as growing demand for essential materials forces up prices and lengthens delivery times. Such avoidable delays to construction could cost consumers billions of pounds over the coming years.”
Kaul emphasized that early procurement at scale would mitigate supply chain challenges and send a strong signal of Britain's commitment to clean energy investment. “These proposals balance acceleration with accountability to ensure that companies operating within Ofgem's strict financial framework are delivering projects on time and at the best value to customers,” he noted.
The APM framework would support domestic manufacturing, attract international investment, and accelerate project delivery to help meet the government's net-zero goals. Energy Minister Michael Shanks expressed support for the proposal, saying, “The independent National Energy System Operator has said that clean power by 2030 is achievable and can create a cheaper, more secure energy system. To get there, we need to give developers a head start to secure the essential equipment needed for new clean energy infrastructure.”
Shanks highlighted the need for proactive measures, stating, “By getting ahead of the global race for these materials, developers will be able to avoid costly delays to projects and ensure nothing stands in the way of our clean power mission.”
The consultation on the APM, which runs until December 18, proposes the introduction of a “use-it-or-lose-it” allowance by early 2025. The mechanism would include governance to return unused funds to consumers and allow adjustments to its scope as supply constraints evolve. Kaul stressed that early procurement would reduce risks, lower costs, and demonstrate Britain's commitment to advancing its energy networks.
