B040 - Energy Grid Infrastructure (Cost Reduction) Bill - Second Reading

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reduce electricity system costs by eliminating renewable energy waste, modernise grid infrastructure, and protect consumers from unnecessary charges arising from grid constraints

BE IT ENACTED by the King's most Excellent Majesty, by and with the advice and consent of the Lords Spiritual and Temporal, and Commons, in this present Parliament assembled, and by the authority of the same, as follows:—

Section 1: Definitions

Renewable energy curtailment - the deliberate reduction of electricity generation from renewable sources due to grid constraints, for which consumers pay compensation costs.

System balancing costs - costs incurred to maintain electricity supply and demand balance, including payments to generators to reduce output and backup generation costs.

Grid constraints - limitations in electricity transmission capacity that prevent renewable energy from reaching consumers.

Network operators - companies responsible for electricity transmission and distribution infrastructure.

Section 2: Consumer Protection from Grid Constraint Costs

1. Network operators shall not recover costs from consumer bills where such costs arise from:

2. All renewable energy curtailment costs shall be carried by network operators rather than consumers from 1st January 2026.

3. Network operators must publish monthly reports showing:

Section 3: Grid Investment Requirements

1. Network operators must demonstrate adequate investment to reduce renewable energy curtailment by:

2. Targets may be adjusted for circumstances that are legitimately beyond operators control, subject to:

3. Failure to meet these targets shall result in:

Section 4: System Cost Transparency

1. The energy regulator shall publish annual reports on:

2. Network operators must provide clear information to consumers showing:

Section 5: Grid Modernisation Fund

1. A Grid Modernisation Fund shall be established funded by:

2. The fund shall finance:

Section 6: Renewable Energy Integration

1. New renewable energy projects above 50MW must demonstrate that:

2. Planning consent for renewable projects may be conditional on:

Section 7: Performance Standards

1. Network operators must meet minimum performance standards including:

2. Operators exceeding these standards may retain up to 30% of cost savings achieved as additional revenue.

Section 8: Enforcement Powers

1. The energy regulator may:

2. Before directing specific grid infrastructure investments 1(b) the regulator must

3. An annual review shall assess progress and recommend additional measures if targets are not being met.

Section 9: Employment and Skills

1. Grid modernisation projects shall prioritise:

2. At least 50% of grid modernisation jobs meaning engineering, technical and construction roles shall be filled by UK workers through training partnerships with trade unions and technical colleges.

Section 10: Safety and ethics of grid level storage and grid level generation systems

The following devices are prohibited in new construction or in modernisation of existing grid level facilities for environmental and humanitarian grounds;

(a) Lead based photovoltaics;

(b) Cobalt based cathode materials in Lithium-ion batteries unless that cobalt can prove it did not originate in artisanal mining in the DRC; and

(c) Any photovoltaic cell originating in China that cannot prove its manufacture and supply chain is free of Uyghur slave labour.

Section 12: Extent, Commencement, Review and Short Title

1. This Act comes into force on 1st January 2026.
2. The Secretary of State shall review progress every 3 years and report to Parliament on:

3. This Act shall extend to England and Wales only.

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This Bill was written by The Chancellor of the Exchequer, The Right Honourable u/CapMcLovin MBE, Deputy Prime Minister, Secretary of State for Infrastructure, Housing, Transport and Energy, and Minister for Equalities, on behalf of His Majesty's 3rd Government.

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Opening Speech:

Deputy Speaker,

I rise to address a pressing issue that is costing every household in Britain hundreds of pounds annually whilst undermining our clean energy transition.

This year alone, we have wasted over £650 million paying wind farms to shut down on windy days because our electricity grid cannot cope with clean energy. Simultaneously, we pay expensive gas power stations to generate electricity instead. Working families are funding this absurdity through their energy bills.

The Octopus Energy CEO put it perfectly: "It's crazy to build wind farms where there's no grid, then pay them to sit idle and then pay the most expensive fossil fuel plants to generate the power instead." This must end, we must reduce the reliance on fossil fuels.

According to reports without action, these costs could reach £8 billion annually by 2030. This bill tackles the problem at its source. From January 2026, network operators cannot pass renewable energy curtailment costs to consumers. If they choose not to invest in adequate grid infrastructure, they pay the price and not working families.

We have set clear reasonable targets, 50% reduction in curtailment costs within three years, 90% within ten years. Network operators who exceed these targets keep 30% of the savings. Those who fail face penalties and regulatory intervention.

This bill creates a Grid Modernisation Fund using penalties from underperforming operators and carbon pricing revenue. This funds strategic upgrades in areas with high renewable generation, energy storage to reduce waste, and smart technology to balance supply and demand.

Speaker, this delivers on our King's Speech commitment to phase out fossil fuels through renewable energy investment. But we're doing it intelligently, building the grid infrastructure needed to capture renewable energy's full value rather than wasting it. This bill protects consumers, reduces emissions, creates skilled jobs in grid modernisation, and positions Britain as a leader in smart energy systems. It's a practical policy that saves money whilst accelerating our clean energy transition.

I commend this bill to the House as essential infrastructure for lower bills and a cleaner future.

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Your Noble Lordships may debate and submit amendments to this bill until 10pm GMT on the 12th of December.