New wave of interconnectors could reduce bills and strengthen the security of supply
New types of electricity cables, called multi‑purpose interconnectors (MPIs), could bring significant benefits to the UK and neighbouring countries. A new study by RenewableUK and National Grid says these cables could generate over £13bn in economic benefits.
MPIs perform two roles simultaneously.
- Transmitting electricity from offshore wind farms back to land.
- Connecting the UK’s electricity system directly with other countries.
By combining both functions into a single cable, MPIs could reduce the need for multiple infrastructure projects, resulting in:
- Less construction along the coast
- Less impact on local communities
- Less harm to the environment
A new task force has been set up to create recommendations on how the UK can deploy this new MPI technology in its waters.
Major firms demonstrate business benefits of climate leadership
A small group of major businesses is demonstrating how environmental leadership can deliver significant benefits.
A study found that the 15% of companies worldwide embedding climate and nature into core business decisions are cutting emissions at four times the rate of their peers. Collectively, these companies unlocked around £162bn in financial opportunities in the last 12 months, according to a report from CDP.
- These companies reduced emissions at an average compound annual growth rate (CAGR) of 4%, compared with just 1% among lower-performing companies.
- Japan leads globally with 22% of companies achieving leadership status on climate.
- The UK (17%), the EU (16%), and India (11%) follow.
Warning over clean energy supply chains
A new report says the UK must strengthen its cleanenergy supply chains to meet its climate goals.
The Institute for Public Policy Research, a think tank, says the Government should follow a strategy called “securonomics.” This means making sure the UK can reliably get the materials and equipment needed for clean energy, even when global events — like trade disputes or conflicts — disrupt normal supply routes.
The report warns that these disruptions make things more expensive, which affects both families and businesses in the UK.
It also says the Government should use a wide range of policies to spread clean energy manufacturing across more countries — including building more of it in the UK whenever possible.
New Green Claims Guidance for supply chains
On 22 January 2026, the Competition Markets Authority (CMA) published guidance on making green claims across supply chains.
What this means for end users
- The guidance aims to ensure that businesses check the impact of their supply chains so that green claims are truthful and accurate.
- It provides an explanation of obligations, plus checklists to work with supply chains to drive transparency.
- End users who are responsible for, or part of, a supply chain for green products or services should ensure they understand their obligations.
AI impact on UK decarbonisation highlighted
AI is already having a significant role in accelerating decarbonisation in the UK, according to a new study. The annual report, from the AI for Decarbonisation Virtual Centre of Excellence, said there have been tangible steps forward this year.
The study highlights progress in areas such as:
- AI-powered EV charging for managing low-carbon electricity grids.
- Quicker deployment of heat pump installations.
However, it also notes that progress in some areas has been slow or “hindered by generative AI hype”. The report concluded that much more work is required to fully realise the benefits of AI for decarbonisation.
Sam Young, lead author of the new report and AI practice manager at the Energy Systems Catapult, said:
"Indiscriminate use of AI can increase emissions, but smart, targeted uses are already breaking down some of the hardest barriers to a low-carbon economy."
UK to join major wind farm project with nine European countries
The UK will join nine European countries—including Norway, Germany and the Netherlands—in backing a major expansion of offshore wind projects in the North Sea. The agreement, signed by Energy Secretary Ed Miliband in Hamburg, commits participants to building a shared, interconnected offshore energy system by 2050.
Key Features
- Multi‑country wind farms: For the first time, some offshore wind farms will connect directly to multiple national grids via undersea interconnectors.
- Expanded interconnector network: The UK already operates 10 cables; new links aim to improve energy flows and reduce system congestion.
Expected Benefits
- Greater energy security: Reduced reliance on volatile fossil fuel markets.
- Lower system costs: National Grid analysis suggests reduced “constraint payments” and improved use of surplus power across time zones.
- Consumer savings: Existing interconnectors have delivered an estimated £1.6bn in savings since 2023.
Risks & Points of Tension
- Price competition: Operators may sell electricity to the highest‑paying market, potentially raising UK prices during tight supply periods.
- Political sensitivity: Norway has already restricted exports during low domestic supply and blocked a proposed Scotland–Norway cable, highlighting potential friction.
Political Landscape
- Government & industry are backing the deal as a long‑term cost‑reduction and security measure.
- Opposition parties have warned that rapid wind deployment is contributing to higher bills.
Networks launch voltage change consultation
UK energy network operators are proposing to change voltage levels in a bid to better cope with new low-carbon technologies.
Under the plans, the lower limit on the distribution network would be reduced to 207V, a 4% drop. The Energy Networks Association (ENA) said the connection of technologies such as domestic solar generation and electric vehicle chargers to the grid from a single location can lead to over-voltage, which can cause household and commercial equipment to shut down when protective limits are reached.
It said the proposed change would give networks a greater scope to operate in.
Lawrence Slade, Chief Executive at the ENA, said the current voltage limits, established in 1995, were set conservatively high to ensure all customers received a consistent level of service across the whole network. Since then, technology has changed, and more domestic low-carbon generation and low-carbon technologies have connected to our networks.
"Operators need the flexibility to adapt, including by reducing the voltage limits. At this stage in the process, we're keen to listen to all stakeholders to ensure the proposals we are finalising after the consultation are effective for everyone."
Handful of companies account for half of global fossil fuel emissions
Just 32 companies were responsible for 50% of global fossil fuel emissions in 2024.
Latest figures from the Carbon Majors database show
- The number of major emitters has fallen from 38 five years ago, which it said demonstrated the consolidation of emissions among an increasingly small group of entities.
- Asian companies remain the largest contributors, responsible for nearly one-third of global fossil fuel emissions tracked by the database.
- State-controlled fossil fuel producers remain dominant, representing 17 of the top 20 emitters.
- The database shows that 17 of the top 20 emitting companies are controlled by governments that opposed a COP30 proposal for a roadmap to transition away from fossil fuels.
Christiana Figueres, co-founder of the Global Optimism pressure group, said:
"When we need to accelerate progress to the clean energy future that would give us greater energy security, affordability and freedom, these emitters continue to block our way."
But she said the data provides a tool for the growing majority who are coming together to champion science-backed solutions and accountability.
That concludes this issue of the UK Energy Industry News Update, highlighting key developments shaping the energy sector. For further details or to discuss how these changes may impact you, please contact us.