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The UK government’s publication of the Reformed National Pricing Delivery Plan (RNP Plan) makes it clear that UK energy policy is moving to a more strategically planned and directed power system, within which the role of markets is primarily to drive innovation and efficiency.
These reforms carry significant implications for developers, investors and other market participants across the energy sector, as they will reshape the regulatory and commercial landscape within which generation, storage and network infrastructure is sited, financed and built.
Last year, the Review of Electricity Market Arrangements (REMA) concluded that the UK should not move to zonal electricity pricing. The Government will instead retain a national electricity market, while using Reformed National Pricing to strengthen strategic planning and system coordination so that generation and transmission capacity is located more efficiently.
The forthcoming Strategic Spatial Energy Plan (SSEP), now expected in autumn 2027, is intended to be the centrepiece of that approach. It will identify potential locations, volumes and technologies for electricity and hydrogen generation, and help government and regulators—alongside market signals—assess where the infrastructure needed for the transition should be developed.
The SSEP has long been viewed as potentially transformational. The key question has always been how it would be turned into practical decision-making, and how prescriptive it would be for market participants.
Although some details remain subject to consultation, the RNP Plan presents the SSEP as a Great Britain-wide blueprint for meeting the Government’s energy objectives. By highlighting the most cost-effective locations for future electricity, hydrogen and storage infrastructure, it should guide private investment decisions in terms of what capacity is expected to be built, where and when. The RNP Plan also begins to set out how that framework will be implemented.
The SSEP will also provide the basis for the future Centralised Strategic Network Plan (CSNP). The CSNP, due in 2028, will identify the networks needed to deliver the SSEP and the timing for those networks. National Energy System Operator (NESO) has indicated that it intends to update the SSEP regularly, with later versions potentially covering other types of energy, including natural gas. The policy aim is that, by anticipating network need earlier, developers of SSEP-aligned projects should have greater confidence that network infrastructure will be available when they need to connect.
Regional Energy Strategic Plans (RESPs) will add a further layer of planning. NESO will prepare RESPs for England, Scotland and Wales using the SSEP outputs. Their purpose is to help ensure that local areas receive the infrastructure they need and to connect national strategy with local area energy planning. However, this planning cascade will take time to put in place, which raises questions about how much influence it can have before 2030.
The RNP Plan reflects a clear policy view that markets alone cannot resolve the connected challenges facing the energy system. Strategic planning is therefore expected to play a greater role alongside market mechanisms. The Plan’s measures focus on using the Government’s siting and investment levers to turn the SSEP from a strategic blueprint into deliverable projects.
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