Question to the Department for Energy Security & Net Zero:

To ask the Secretary of State for Energy Security and Net Zero, what assessment he has made of whether curtailment payments create incentives to locate generation in areas with insufficient grid capacity.

The revenue that generators can make from curtailment payments is regulated by Ofgem through the Transmission Constraint Licence Condition. This regulation limits the revenue generators can make from being curtailed to the value of the revenue lost through not being able to generate plus reasonable costs. Ofgem can and does take enforcement action against generators that it believes are not complying with this regulation.

The Strategic Spatial Energy Plan (SSEP) will optimise the siting of new sources of electricity generation across Great Britain. The Government’s Reformed National Pricing programme will have the SSEP at its heart, and reforms will be designed to ensure incentives for generation projects encourage siting and investment in areas that align with the SSEP.