25 June 2026 - Ofgem's latest demand connections reform update sets out new approaches to connecting large electricity users to the transmission network, including project structures that bring demand, generation and storage together through shared high-voltage infrastructure.
As electricity demand grows and pressure on the connections system increases, Ofgem is considering new ways to connect major users while making better use of available network capacity.
Ofgem’s latest demand connections reform update provides one of the clearest signals yet that projects combining generation, storage and demand are moving closer to the centre of the grid connections debate.
On 16 June 2026, Ofgem published its latest update on the Connect pillar of its demand connections reform programme. The programme is examining how new connection arrangements could allow viable large-scale demand projects to connect more quickly while maintaining a secure and efficient electricity system.
Generation, Storage and Demand on a Shared Connection
A notable feature of the update is the growing recognition of projects that combine electricity demand, renewable generation and energy storage through shared high-voltage infrastructure. Instead of connecting each asset separately, the approaches being considered could allow them to share connection infrastructure, helping to use available network capacity more efficiently and support a more flexible electricity system. The update also explores alternative approaches to the ownership and delivery of connection assets, including arrangements that could allow connected parties to play a greater role in the development and management of shared infrastructure.
While Ofgem does not use the term Renewable Energy Hubs, several of the structures it considers in this update closely reflect the principles PandoREH has been developing: combining renewable generation, energy storage and major electricity demand through shared grid infrastructure. The proposals therefore provide further regulatory recognition of the potential benefits of considering how these assets can operate together, including more efficient use of network capacity.
Greater Flexibility in Delivering Connections
The update also considers more flexible models for delivering high-voltage connection infrastructure. Ofgem is progressing work on a potential Independent Transmission Owner (iTO) licence framework, alongside wider use of self-build-and-transfer arrangements. Together, these measures could give developers greater flexibility in how connection infrastructure is delivered and owned.
For projects involving multiple energy assets and large electricity users, these reforms will create clearer, more fundable structures for shared connection infrastructure, particularly where ownership, investment and delivery need to be coordinated across several parties.
Flexible and Phased Connections
The regulator is also considering alternative connection arrangements for large demand customers, including phased connections where capacity increases over time as projects develop rather than being provided in full from the outset. Ofgem notes that this could be particularly relevant to data centres, where electricity demand is often deployed in stages.
The update also explores enhanced flexibility mechanisms and alternative operational arrangements that could allow major electricity users to support wider system needs while making more effective use of available network capacity.
Taken together, these proposals point towards a more flexible approach to managing demand on the transmission network, recognising that not all projects require capacity in the same way or on the same timescales.
Implications for Renewable Energy Hubs
The proposals bring several principles underpinning integrated energy developments into formal regulatory consideration.
PandoREH has been developing Renewable Energy Hubs around the principle that generation, storage and major electricity users should not always be treated as entirely separate projects. Bringing them together can allow renewable electricity to be consumed closer to where it is generated, storage to shift energy between periods of surplus and demand, and major users to make more efficient use of shared connection infrastructure.
While Ofgem’s June update does not establish a formal category of Renewable Energy Hub or hybrid connection, it reflects growing recognition of these integrated principles. As pressure on the network increases, coordinating generation, storage and demand through shared infrastructure could help improve network efficiency, reduce constraint costs and accelerate project delivery.
Looking Ahead
The details of these reforms are still being developed. Ofgem is continuing work on the design of an iTO licence, the implementation of self-build-and-transfer arrangements, and the connection and operational frameworks available to large demand customers.
Consultation into 2027 will give industry further opportunity to shape these measures, with the potential to influence how integrated developments such as Renewable Energy Hubs are assessed and delivered across Great Britain.
While many aspects of the framework remain under development, the June update signals a clear willingness to explore models that make better use of network infrastructure and enable more flexible connections. PandoREH will continue to engage with stakeholders across the energy sector and contribute to the development of a more flexible, resilient and cost-effective energy system.
References and Further Reading
Ofgem – Connect Update: Demand Connections Reform (16 June 2026)
National Energy System Operator (NESO) – Connections Reform
National Energy System Operator (NESO) – Strategic Spatial Energy Planning
