This week, two of the six companies that run the country’s local electricity grids began making green energy firms pay for an estimate of how much it will cost to connect their solar and windfarms.
Previously the grid connection estimate was provided for free.
However, it will now cost anyone hoping to connect a small renewable power station between £2,500 and nearly £10,000, even if they do not go ahead with the scheme.
The shift was made possible by a government change to regulations earlier this year.
Rebecca Long-Bailey MP, the shadow business secretary, said: “It was the Tories’ recent reforms that allowed for these outrageous financial demands to be made, which will have serious repercussions right across the renewables sector and for the future of clean energy.”
Jeremy Corbyn has singled out network companies for criticism, saying they should be nationalised because they are overcharging and causing delays to green energy projects.
Renewables firms said the move could deter new green projects. “It’s yet another hurdle on the path to a renewable energy future,” one small solar developer told the Guardian.
They went on: “Until now grid connection applications for solar or windfarms were free – developers would put in an application to see if they could get a connection at a cost that would make a project viable.
“But now the distribution network operators have decided to wring yet more cash out of the sector on top of already overcharging for grid connections.”
Documents sent by network companies to renewable energy firms show that the cost estimates will be priced between £2,556 and £9,740.
Green energy developers will now have to pay that cost regardless of whether they go ahead with their scheme, and before knowing how expensive the connection will be. The cost of the actual grid connection is in addition.
Two network companies, UK Power Networks and the networks unit of big-six energy supplier SSE, have already informed customers of the changes, which they argue will spread costs more fairly.
The other four groups that run local power grids, which solar schemes connect to, are due to follow suit.
Network companies, which have come under fire from consumer groups for “eye-watering” profit margins, said the reform was necessary to make the connection process more efficient.
Distribution network operators are receiving “hundreds, if not thousands” of requests each month for the estimates, known as ‘connection offer expenses’, one source said.
The firms said the changes were revenue neutral for them and would not result in higher profits.
A spokesperson for the Energy Networks Association said: “The charges for connection applications have been introduced following a recent government consultation, which found that the majority of industry supported the change.
“Under the old system a large number of speculative applications were being made without being followed through.”
