The chicken and the egg
The dilemma faced by industry here has been referred to as the 'chicken and egg' problem, in that network owners cannot pass the required regulatory tests to build new infrastructure without being able to show sufficient demand from new generation, and generators cannot commit to building new projects without knowing that there will be a network to connect to. This issue is affecting private sector investment in the renewables industry, which is a vital part of the energy transition we must have.
Project developers are facing long delays in the connection and commissioning process, which in turn is affecting risk appetite for both equity and debt financing. Once operational, renewable generators are facing a heightened risk of being curtailed, which has a direct impact on revenue and project economics.