Outcomes of the new connections delivery pipeline

To be offered a Gate 2 connection, a project must be ready (i.e. have the required land rights) and be strategically aligned with Clean Power 2030[1] (CP30). NESO’s diagram below shows by technology type the prioritised projects that will receive a Gate 2 offer[2].

NESO reported that 217 GW of Gate 2 ready projects were not prioritised as they were not strategically aligned[3]. These are shown in the following table:

While the capacity of battery projects not prioritised comes as no surprise, the number of solar projects unable to be prioritised is higher than expected given the remaining 2030 and 2035 capacity pots NESO report for solar.

Initial discussions with developer contacts have confirmed that most advancement requests were unsuccessful. NESO reported that 3 GW was approved for advancement, but with Phase 1 capacity pots mostly full, opportunities to advance projects were limited.

There has also been confusion around NESO’s treatment of hybrid projects. The Connections

Network Design Methodology states that hybrid projects would be managed based on how they interact with the system. During the Gate 2 to Whole Queue process, NESO asked hybrid applicants whether their storage project is import only (located with demand), export only (located with generation), or both import and export. In some instances, the Readiness Declaration for the battery element was amended to 0MW for import or export only.

For batteries co-located with generation projects which requested export only, the battery has received a Gate 2 and the generation project has received a Gate 1. This is because the battery did not need to be protected as it is not operating as a battery. Hybrid project developers may find that the Gate 2 offers mean the battery cannot charge and discharge as intended, and will not progress with the project.

Opportunities

The next Gated Window will be no earlier than April 2026. Based on the reformed connections queue, there are the following opportunities:

• Onshore Wind: 5 GW capacity in England and Wales.
• Solar: Most Zones undersupplied in Phase 1. Zones T3, T8, T9 have remaining capacity for Phase 2.
• Low Carbon Dispatchable Power: 7 GW for Phase 2, which creates a potential opportunity for unabated gas plants to convert to low-carbon solutions and reapply in the next Gated Window.
• Long Duration Energy Storage: 150 MW for Phase 2.

Next steps

The Gate 2 to Whole Queue notification provided by NESO contains limited information, based on the following template[4]:

The notification does not provide the estimated connection date, whether the connection will be able to connect earlier under a temporary non-firm arrangement, the updated Queue Management Milestones, the reinforcement works, the cable route, and any outage requirements.

The reformed queue is now with the relevant onshore network owners for their assessment, who will be restudying the reformed queue and responding to the gated applications from NESO. You will have to wait until the full offer is issued to receive this information. NESO has set out the following timeline for when offers will be issued:

Decisions about ongoing project viability will have to be made based on the notification alone. Where seeking lender investment, lenders may require sight of the full offer before entering into discussions. This is also challenging if you are expecting a non-firm connection date in 2026/2027 and to have wait until Q2 or Q3 of 2026 for your offer.

NESO has issued a handbook[5] outlining what to do when you receive your Gate 1 and/or Gate 2 offers. If your project did not meet the Gate 2 criteria, you will receive a Gate 1 Agreement to Vary (ATV). This suspends all obligations within your existing agreements and will explain why your project was classified as Gate 1. The ATV needs to be signed and returned within 28 days. If you placed cash security, you will need to provide up-to-date bank details so NESO can process your refund.

If your project has met all the necessary criteria at Gate 2, you will receive a Gate 2 Modification Offer. You will need to sign and return it within 90 days. After signing, you will be required to place the necessary securities within 30 days.

While NESO’s handbook sets out a complaints process, it also states that from 5 December the pipeline is finalised and no new projects can be added or reordered.

Demand

The new queue includes around 100 GW of capacity. All Gate 2 ready projects that applied are in the queue as there is currently no permitted capacity for transmission connected demand projects.

NESO has reported that there are significantly more Phase 2 transmission connected demand projects in the queue than anticipated. Given the surge in demand connection applications, Ofgem is reviewing options to ensure there is a viable demand queue[6].

Project Commitment Fee

On 8 December 2025 Ofgem approved the introduction of a Progression Commitment Fee (PCF)[7]. The PCF is triggered if a cumulative generation threshold of 6.5 GW of terminated projects at Milestone 1 (M1) is reached. If triggered, NESO will decide whether to activate the PCF which Ofgem will have final approval on.

If the PCF is activated, generation projects that sit between Gate 2 and M1 are required to post additional securities based on a profile which starts at £2,500/MW and increases by £2,500/MW every six months until it reaches a cap of £10,000/MW. Only if a project terminates or reduces capacity at M1 is the PCF payable, once a project successfully passes M1 the PCF security is refunded.

End-to-end review

Typically grid connection offers contain wide rights for the estimated connection date to be delayed and the estimated connection costs to be increased. While the connections queue has been reformed, achieving the connection dates in the Gate 2 offers will be subject to network companies having the resources to complete the relevant connection works.

Ofgem are now seeking views on updated proposals and next steps of the connections end-to-end review of the regulatory framework.[8] The consultation closes on 27 February 2026. The consultation paper[9] refers to key themes, with a common theme relating to network companies meeting dates in connection agreements. Ofgem wants to ensure that the regulatory framework suitably incentivises/requires network companies to offer customers ambitious but achievable connection dates.

Ofgem is pursuing the development of prescriptive licence conditions that specify minimum requirements in relation to standards of service. These requirements target specific milestones at pre-application and post-offer acceptance stages. For example, a minimum timeframe to respond to project-specific post-offer communications, the detailed design stage, and arranging the completion of vital survey works.

Ofgem also intends to explore the merits of liquidated damages in contracts between the network company and the customer, to understand their potential for addressing connection delays.

How we can support you

Our Infrastructure & Energy specialists work together to support clients throughout the Connections Reform process, including:

• Legal and practical advice and support in relation to Gate 1 and Gate 2 offers.
• Commercially-focused, cross-disciplinary advice and transactional assistance in connection with infrastructure and energy developments and financings.
• Training on grid connection reform and related sector horizon-scanning.
• Risk management and effective dispute resolution strategies if/when any grid connection or related issues arise.

For further information, tailored advice or staff training, please contact Shane Toal, Ben Sheppard or Sophie Linnell.

[1] Clean Power 2030 Action Plan – GOV.UK

[2] Connections Reform Results | National Energy System Operator

[3] Queue Outcomes Webinar

[4] https://www.neso.energy/document/373546/download

[5] https://www.neso.energy/document/373546/download

[6] Demand connections update

[7] Connection and Use of System Code (CUSC) CMP448: Introducing a Progression Commitment Fee to the Gate 2 Connections Queue (CMP448)

[8] Connections end-to-end review: updated proposals and next steps​ | Ofgem

[9] Connections End-to-end Review – Updated Proposals and Next Steps