Unpacking the Electricity Tendering Revolution: What You Need to Know About the 2025 Onshore Transmission Regulations

On April 3rd, 2025, the UK government unveiled a key piece of legislation that promises to reshape how onshore electricity transmission projects are managed and awarded: The Electricity (Early-Model Competitive Tenders for Onshore Transmission Licences) Regulations 2025. Scheduled to come into force on April 25th, this regulation introduces a competitive framework aimed at optimizing the way these crucial infrastructure projects are executed across England, Wales, and Scotland.

The Competitive Tender Process: An Overview

The new regulations establish a structured competitive tender process for awarding onshore transmission licences. Here's a breakdown of how this process will unfold:

1. Pre-Qualification Stage: This initial phase identifies which bidders meet the requirements to participate further. Bidders must submit pre-qualification questionnaires that are evaluated based on set criteria, ensuring only capable contenders move forward.

2. Invitation to Tender: Qualifying bidders from the first stage are invited to submit detailed proposals. The delivery body evaluates these tenders to select a provisional preferred bidder.

3. Best and Final Offer (if necessary): In cases where the initial tender process does not yield a clear winner, a best and final offer stage may be held to refine bids.

4. Delivery Body Functions Assessment: Before finalizing the preferred bidder, the delivery body's handling of the tender process is reviewed to ensure compliance and fairness.

5. Preferred Bidder Selection: The successful bidder is chosen to be granted the onshore transmission licence for the project.

Objectives and Benefits

The core goals of this competitive tender system include fostering transparency, integrity, and fairness in awarding licences, while also ensuring efficient delivery and operation of electricity transmission projects. This approach is designed to protect the interests of both existing and future consumers by encouraging competition, which can lead to cost efficiencies and innovation.

What This Means for Bidders and Stakeholders

Bidders will need to be prepared for a rigorous process that involves multiple stages of evaluation and potential re-evaluations should any issues arise. They must also be ready to meet entry conditions and provide security against the costs associated with tendering.

For existing licence holders, there’s room for modification to align with tender outcomes, ensuring the smooth integration of new transmission projects with ongoing operations.

Potential Challenges

The regulations also detail circumstances under which tenders can be re-run or cancelled, such as non-compliance or withdrawal of preferred bidders. This ensures that only viable projects move forward and that resources are not wasted on unfeasible proposals.

Conclusion

The 2025 regulations mark a significant shift in how the UK's onshore electricity transmission projects are managed, aiming to bring more efficiency and competitiveness into the sector. With careful planning and adherence to the new rules, stakeholders can expect a more transparent and fair process, ultimately benefiting the nation's energy infrastructure and consumers. For further details, stakeholders are encouraged to review the full impact assessment and related documents available through the Department for Energy Security and Net Zero.