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One of Britain’s largest trade unions says electricity networks are failing to invest enough in maintenance, raising further doubts over the sector’s resilience following a damning report into a substation fire that led to the closure of Heathrow airport.
Sue Ferns, senior deputy director-general of Prospect, said it had “repeatedly” raised questions with Ofgem, Britain’s energy regulator, over the resilience of the network and argued that the way the sector is regulated disincentivises prompt maintenance.
The union has thousands of members who work in Britain’s network businesses, which are a regulated monopoly split between five major companies: National Grid, SSE, Scottish Power, UK Power Networks and Berkshire Hathaway’s Northern Powergrid.
“Engineers working across the networks, they tell us that assets have not been renewed or improved over a very long period — that they absolutely see the need for maintenance but that work isn’t being prioritised,” she told the FT.
An official review into the blaze at the National Grid substation in March found it was caused in part by failure to replace a part of a transformer that registered high moisture levels when last serviced in 2018. It also found that the fire suppression system in the substation was out of service.
Prospect said companies preferred to sweat existing assets rather than build new ones, and were not sufficiently maintaining their old infrastructure.
In a submission to the official review into the fire, seen by the FT, the union added: “The consequences of this continued lack of investment are now becoming painfully clear. Not only has it slowed progress towards a cheaper, cleaner energy system [ . . . ] it has significantly reduced the resilience of the existing system.”
It blamed regulation, arguing that setting prices for five years incentivised short-term behaviour. It also said Ofgem often values efficiency and reducing costs ahead of maintenance work.
In response to Prospect, Ofgem said Britain had “one of the most reliable and efficient energy systems in the world,” adding: “However, there is no room for complacency, and we fund and incentivise licensees to ensure they maintain and invest in their networks to deliver the best possible service for consumers.”
It added: “We expect all networks to properly maintain their assets, and any that fail to deliver the required standards face the prospect of fines and other penalties.”
Prospect boss Ferns added that huge demand for new electricity connections for wind and solar farms had put extra pressure on the workforce. “There’s less and less workforce flexibility to do the maintenance task,” she added.
In a review of the high voltage networks during 2023-2024, Ofgem said they had “fallen behind” goals for work on existing assets, and called for a “significant boost” in activity.
However, it added that all transmission operators reported “exceptionally strong levels of network reliability and surpassing their annual targets to minimise electricity loss [ . . . ] world-class levels of network reliability are being maintained.”
Performance was more mixed for the lower voltage distribution network operators. The sector “did not perform well” on customer interruptions, Ofgem said. Several networks missed targets on the score.
Distribution network owners also spent less on equipment replacement and refurbishment than they were allowed during the first year of the current price control period, owing to factors such as delays getting hold of equipment and workers. However, they were forecast to collectively overspend by the end of the period as projects catch up.
The report last week found that the transformer that first caught fire at the substation had last had “basic” maintenance in July 2018. It added that 87 per cent of transformers on National Grid’s high-voltage transmission network were within their normal maintenance cycle, above the company’s target of 85 per cent.
The Energy Networks Association trade group highlighted the sector’s record of “near 100 per cent reliability” and said the lower voltage distribution networks were investing around £20bn in this price control period between 2023 and 2028 in resilience and maintenance.
It added: “Network operators are clear that sustained investment is vital for the continued maintenance of the UK’s grid and to improve overall resilience.”
