A very British queue: the 'great grid' outrage
Published on 3rd February 2026
What actions should asset managers and developers consider as the grid upgrades and what are the options for an unsuccessful applicant?
Great Britain's grid log jam has been causing difficulties for developers, investors and asset managers for many years. The National Grid's "great grid upgrade" programme and the "first ready and needed, first connected" principle will hopefully provide some progress for projects, but there will be much uncertainty along the way and many investments put at risk.
Following months of paused applications for grid connection, National Energy System Operator (NESO) completed its queue reordering exercise in late 2025. The reforms have cut the combined transmission and distribution connections queue from 725GW to between 240GW and 460GW, removing projects with limited prospects of completion. However, with the proposed generation supply having previously outstripped capacity by three times, many projects have fallen away.
The push for the "brightest and the best" means that developers are having to work harder and faster to show that they can get through NESO's "gates" by demonstrating the necessary land and permitting rights, financial commitments and meeting the strategic requirements of the national and local grid. NESO will be managing the queue and determining who goes where. Throughout all this, owners need to manage their ongoing risks and obligations.
Traversing the detailed requirements of the proposed reforms to the grid connections system, known as TMO4+, is keeping legal and technical advisers very busy as owners and developers look to ensure that their projects are going to get the best possible position in the reordered grid connection queue. In addition to the technical procedures and application forms, owners also need to exercise some careful contractual management.
Milestones and management
If a project does manage to retain a spot in the grid connection queue following NESO's queue reordering, the project's asset manager will be mindful of the increased importance of developing the project in accordance with the milestones prescribed by the grid connection arrangements. Failure to demonstrate progression against these milestones gives rise to right for NESO or the distribution network operator, as applicable, to terminate the proposed grid connection. In light of the current grid crisis, these rights could be exercised. NESO has stated that it will be "uncompromising in our approach to driving out and pushing back projects that cannot meet their connection date".
In addition to the specific grid connection milestones, asset managers will need to be on top of the precise contractual framework for each of their projects. These have often involved discussions over a long period of time with the relevant stakeholders – landowners, equipment suppliers, funders and network operators – and the arrangements have often gone through various iterations and different entities. All of these contractual relations need to be up to date and enforceable.
Considerations for asset managers
Asset managers should ensure that the contracts and options have not expired and that any variations or renewals have been effective. In particular, they will need consider whether adequate consideration been provided for any changes or has there been a compliant deed?
Are the right parties are doing the right things? It is common for the benefits and obligations under contracts to be novated between new parties and, while there can be some leeway regarding novation, certainty as to enforceability should always be the objective. Any novation will require the involvement of all of the contractual parties. It is also common for the benefits of a contract to be assigned to another party, which can be done unilaterally, but there may be notification requirements. Any gaps or irregularities will need to be addressed as a matter of urgency, and any such errors may require notifications to third parties and funders. Consideration should also be given in the event that contractual promises or warranties have been given to third parties, and whether those commitments will still be applicable once any variation or novation or assignment has been effected.
'Zombie project' apocalypse
While there are always going to be some speculative plans that are never going to be completed, there will also be many "zombie projects that could have been contenders if given the chance. Some of them may have had connection dates taken away from them or a change to their point of connection.
Plenty of time and money will have been invested into these endeavours, and if the NESO "gate" is shut in front of them, their new grid connection date is too far in the future, or their point of connection changes, the project may no longer be commercially viable. These zombie projects could then come back to life through the legal claims that follow.
During the TMO4+ consultation process, Ofgem were told that there needed to be a disputes process to allow applicants to challenge a designation decision in respect of the project designation methodology, being just one facet of the grid reordering process. Ofgem published on 8 December 2025 guidance setting out its expectations of how parties should try to resolve disputes relating to reordering and the limited circumstances in which Ofgem will determine those disputes.
Osborne Clarke comment
The dispute resolution mechanisms set out by NESO and Ofgem provide little comfort to disappointed managers of projects that have been shut out of a timely connection. Those mechanisms will not be able to reach resolutions in time to preserve places in the queue. For some decisions, alternative approaches to a challenge may be necessary, including potentially through judicial review. Commercial judicial reviews of this sort would rely on the claimant being able to establish that NESO has acted illegally, irrationally or with procedural unfairness.
The Planning and Infrastructure Act, received Royal Assent in December 2025, and will introduce additional reforms to the electricity network connection process, including temporary powers to the secretary of state and Ofgem to prioritise strategically important connections. Asset managers should monitor these developments closely, as they may provide further opportunities or constraints for their projects.
