Why grid constraints are driving up balancing costs and how new links could help
Britain’s electricity system is facing a costly mismatch: some of its strongest wind resources are in Scotland and the North Sea, while much of its demand lies farther south. In September 2026, Great Britain’s grid balancing costs reached a staggering £505 million, a record monthly total, according to analysis of National Energy System Operator (NESO) data reported by Utility Week. The figure covers the wider work of balancing the system; it is not a bill for wind curtailment alone. Still, it brings the cost of network constraints into sharp focus.
When transmission lines cannot carry all the electricity being generated to where it is needed, NESO must act to keep supply and demand in balance and the network operating safely. It can instruct generators in one area to reduce output and others elsewhere to increase it. On windy days, that may mean turning down Scottish wind while bringing on more generation closer to demand. The pattern is often called the “curtailment paradox”: clean electricity is available, yet grid limits can prevent it from reaching consumers.
This is not simply a question of building more pylons. New lines and subsea cables require planning, consent, skilled workers and supply-chain capacity. They also need to connect with the rest of the network. If generation grows faster than transmission, constraints can persist even as new infrastructure comes online. The challenge is to coordinate investment in generation, grid capacity, storage and demand so each part of the system is ready when the others are.
The cost is real, but it needs to be described accurately. Balancing costs include a range of actions, such as managing network constraints, reserves and frequency – not just payments to wind farms. NESO explains that its costs also reflect wholesale prices and the bids and offers submitted by generators. These costs are recovered through system charges and can feed into energy bills, although they are only one part of what consumers pay.
The underlying challenge is physical. Wind generation has grown quickly, while transmission infrastructure takes time to plan, consent and build. Better use of existing lines, storage, flexible demand and new connections can all help. Batteries can shift electricity across hours, while stronger transmission moves it across regions.
There is progress. Eastern Green Link 1 (EGL1), now under construction, will connect the Torness area in East Lothian with Hawthorn Pit in County Durham. Its 2-gigawatt, mostly subsea link is planned to be energised in 2029. Eastern Green Link 2 (EGL2), also under construction, will connect Peterhead in Scotland with Drax in North Yorkshire. Its 2-gigawatt subsea cable is likewise expected to be operational in 2029. Together, the projects will add capacity to move electricity between Scotland and England and strengthen the transmission network.
That does not mean curtailment will disappear when the links open. Their benefits will depend on timely delivery and on the wider grid keeping pace with new generation and changing demand. Local communities will experience construction impacts, and consumers deserve clear information about project costs, schedules and benefits. Developers should also make a lasting contribution through local jobs, skills and investment, alongside careful protection of landscapes and habitats.
For businesses, the grid’s constraints are a reminder to look seriously at energy efficiency, flexible demand and on-site generation where they make practical and economic sense. Producing power close to where it is used can improve resilience, but it is not a universal answer: many organisations will still depend on a reliable national network.
Britain has made a substantial investment in renewable generation. Connecting that power efficiently is the next essential task. EGL1 and EGL2 are not a complete solution, but they are important steps towards a more connected system – one that can waste less clean electricity and make better use of the energy the country already produces.
A practical approach
If you’re considering renewable energy and would like to discuss the right solution for your business, we would be happy to have that conversation.
Get in touch with us on 01733 595150, to discuss your options.
