Our customers include data centres and large industrial energy users, and so power reliability is always top of mind. Grid availability and connectivity to provide this has become such a key issue. That means more uncertainty around connection periods, and not just when but the quality of that connection from a resilience point of view.

So, it's not just the power, the capacity, but resilience to the right specification now and in the future. From a sustainability perspective, there is a clear drive to Clean Power 2030 in the UK. The grid is getting greener, but we need to get the connectivity and the infrastructure resilience and bring the two together in a meaningful time frame.

From a pricing point of view, power prices are obviously inextricably linked to gas pricing - still. And recent years have seen that exacerbated by geopolitics and issues of imported gas supply. This continues to put the UK in one of the highest price brackets for industrial power globally. As we build more embedded generation and decouple ourselves from the grid, this will create resilience from different energy vectors and start to reduce that overall energy price for end users.  

At SEGRO, we are increasingly seeing the need to find bridging power for the next 3-5 years on certain sites while we wait for grid power to come in, in some areas of Central Europe this could be longer. Microgrids have a strong role to play, not only for bridging power but to unlock new business models through exchanging excess power and flexibility with the grid. So that in the future we're not just taking from the grid, we're being good grid citizens and providing benefit into the overall energy system as well. We have a lot of building blocks already in place to achieve this.

We have somewhere close to c.130MW of installed rooftop solar across our portfolio. Some of those sites also have battery energy storage systems. For our strategic sites that are power critical and where we have future grid connectivity in the pipeline, we’re starting to look at long duration energy storage, and other emerging technologies such as industrial scale carbon capture in conjunction with various generation technologies.

A good example is our joint venture SmartParc SEGRO Derby. It's effectively been built with a private network, and there’s a symbiotic relationship with the various occupiers on that sites haring power, heat, and cooling. Interestingly they’re all food production businesses, so some of that heat is a byproduct of their operations.

When you try to apply that to a normal industrial or logistics context, whether that's on a licensed distribution network or private electricity network, there is a lot of regulatory complexity around metering and energy settlement with customers wanting to get their supply of electricity from their own suppliers. This makes socialising and then trying to share locally-generated energy and available power capacity very difficult.

The UK market still isn’t set up to enable that degree of sharing to happen while maintaining freedom of choice from a grid supplier point of view. That said, I think we are at an inflection point where this is going to be required. This might be in small clusters within large sites, where microgrids can help address bridging power and provide flexibility benefits, similarly as E-HGV requirements increase, the need to maximise utilisation of charging capacity across shared infrastructure,that is optimised with microgrid solutions, will be necessary.

So, we need to be creative in how we do that while complying with all the different regulatory requirements from a metering, generation and network infrastructure point of view, while giving our customers the choice they require.

There’s so much interactivity across the energy system. I want to see technology enable us as an ecosystem to understand that interactivity so that,as an example, we don't bring 15km of new cable into a location, and then 3years later be in a situation where somebody else needs to do that again because the system hasn't been forward looking enough to build in contingent infrastructure.

Network owners are now required to build capacity ahead of demand but getting that right with capital upgrade programmes, coordinated along with competitive connection options, has a way to go.

So, enabling interactivity and scenario modelling is key but it is needed now as the next 5 years are critical to securing growth and that needs power.

At the same time, technology can play a role in providing fast and pre-emptive feedback during connection application processes. Often post application, you wait a certain amount of time, feedback comes, and you then need to modify your application or re-submit. The feedback may be a conditional offer with lower levels of resilience than required and then a protracted process of trying to get to the root cause and negotiating alternatives begins.

Part of that challenge is because licensed network owners are compelled to provide the lowest cost option – a single option. This stops other scenarios being communicated that may otherwise improve the position or value to the applicant – so cost versus value isn’t readily understood and can hold back better solutions. Technology could improve this position, not only by continually automating and optimising the application workflow, but also by accelerating the optioneering process and the provisioning of feasible alternatives that could be considered. 

Multiple parallel planning initiatives add complexity to energy provision, but technology can help streamline these efforts, especially as 2030 approaches. Local authorities develop Local Area Energy Plans (LAEPs) that inform Distribution Network Operators’ (DNOs) regulatory business plans, though boundaries don’t always align with Grid Supply Point Strategic Development Plans.

DNOs also produce Distribution Future Energy Scenarios, while transmission owners create similar forecasts, all contributing to future business strategies. At a national level, NESO oversees Transitional Regional Energy Strategic Plans (TRESP), which progress toward the RESP, alongside the Strategic Spatial Energy Plan and the Centralised Strategic Network Plan.

Ensuring effective energy generation and network infrastructure strategies is crucial for meeting CP2030and 2050 objectives. Despite this future multi-faceted energy system planning, developers still face connection delays for the next several years. Connection reforms aim to eliminate inactive projects, but challenges with delivery, and approvals remain, leading to further delays. Technology should help simplify and streamline processes, improve visibility, and promote cross-domain collaboration to boost progress and productivity. 

It’s a question of whether this alignment will happen fast enough to meet the acceleration in power demand that we will see in the next 2-7 years in certain regions and markets. So, there is a clear role for technology to simplify this complexity and make it easier for asset owners to understand grid connection availability and options, and how we can adjust our own schemes and strategic objectives to access that quicker and secure resilience, whether through the grid, a microgrid or combination. Noting that overall downstream lifetime value and resilience will always trump the lowest cost connection option, especially if it is slow and complex to secure.

Then technology has a role in maximising the infrastructure we have, a lot of this already happens in the cloud for fault location etc. but how do we get to a world where “virtual resilience” becomes a reality due to smarter networks and interactive assets,rather than relying on building more hardware, that as we know is a slow and expensive process.

As we deploy more generation and storage assets on microgrids, we’ll need more advanced control and protection systems to manage how different sources of power interact and how their outputs are managed and optimised, not just from and operational perspective set on rules-based algorithms, but also from an economic one too. This is a complex problem that needs technology to help resolve it in a more dynamic environment.

Interconnection queues are holding back at least 1.5 TW of generation and a similar number in data centers.An imbalance of know-how, knowledge, and the right tools has created a dynamic akin to black and white film versus modern IMAX movies.  Specifically, the combination of studies based on stale data in a highly dynamic environment combined with a lack of physical capacity on existing transmission lines are two key factors limiting the acceleration of interconnection timelines.

Splight’s newest product modernises the first factor – stale studies – by incorporating its AI-based technology into studies based on the most up-to-date data. Not just a traditional electrical study, this new offering is an AI-powered simulation of the grid in real-time that can show the real system with detailed scenarios of pre and post contingency.

The second limitation – scarce additional transmission capacity – is precisely what Splight’s flagship Dynamic Congestion Manager™ (DCM™) product was developed to solve: by using machine-learning to provide the grid with a new layer of real-time protection, DCM allows Splight’s customers to access previously inaccessible capacity on the existing grid in a fraction of the time it takes to build new transmission lines.

In both cases, the main factor is the difference between seeing and not seeing.With Splight’s technology, participants can see what is happening in the grid in real-time –without Splight, they are running completely blind in operational terms.

The core problem we are solving is how grid participants manage risk.The world built the transmission network nearly a century ago. At that time, it made sense to build twice the capacity you needed so that you would have the complementary idle capacity waiting in case an anomaly or disturbance, like a failure, occurred. Even though technology has come so far, we are still running grids the same as a century ago. This means that we still have roughly half of transmission capacity going unused.

We use AI algorithms and data in real-time to deploy a new safety layer, that can tackle contingencies in real-time using the technology that wasn’t available a few decades ago,but is now being deployed now on grids across the globe, like IBR, batteries, and other kinds of operating system like BMS.

Utilities are already making great strides to limit revisions and new applications. Notably, they have realised that they can buy themselves both time and flexibility for the future by leveraging modern technology that exists today and has been successfully commercialized – like Splight’sDCM – to free up substantial capacity on existing transmission lines. Not only does DCM allow utilities to satisfy more interconnection requests in the near-term by unlocking more transmission to which renewables and data centres can connect, but it also allows utilities to target their resources where they are needed most urgently in both the medium-term and long-term.

For these hugely impactful technologies like DCM to reach their full potential, it is imperative that the information used in electrical studies reflects only the most up-to-date planning for generation, transmission, and load. We’ve noticed repeatedly that traditional electrical studies do not fit the needs of data centres seeking interconnection. They are seeing significant demand, but they are useless to solve the problems that data centres have.Until we modernise this process to ensure that all stakeholders are using the same, correct information in their planning and decision-making, revisions will be required perpetually and the potential of many game-changing grid technologies like DCM will be restricted.

That’s the problem Splight solves. We unlock that idle capacity using a new approach to risk management.

Resilience as a concept has really come to the fore this year. The US market has basically poured cold water over ESG – we’ve seen many players are actively rolling back or downplaying their sustainability commitments.

Fora long-term property holder like Grosvenor, the question is: how do you build resilience within your business model and assets so they can withstand shocks?The conversation in the industry around sustainability has certainly shifted significantly towards ensuring risk mitigation and avoidance. That said, for us at Grosvenor, sustainability is still incredibly important. In fact, we are doubling down on sustainability, not just pivoting to resilience alone.Sustainability in commercial real estate still drives a significant value uplift.

In the UK market, the introduction of the new net zero carbon building standard comes with very punchy operational decarbonization targets. This means there remains a lot of focus on upgrading heating, lighting, and other systems.

Crucially, the conversation isn’t just about hitting decarbonisation targets anymore. We’re being more pragmatic: what exactly does each asset need to ensure long-term energy stability and remain attractive to tenants? For Grosvenor, that means investing in retrofit and ensuring that new developments exceed planning regulations, which helps create more resilient, future-proofed assets.

Our energy resilience focus is really about removing fossil fuels as fast as possible across the portfolio, working with local authorities to make sure the grid doesn’t fail, plus having insurance and protections for outages through retrofitting.

Grid capacity exceeded limits three times last year in key London areas such as Mayfair and Belgravia, causing power cuts, so this is a very real and growing concern. Solving for this enhances the resilience and attractiveness of our assets long term because it avoids the risk of asset stranding and portfolio devaluation.

Energy exports to the grid aren’t a priority for us. This is because at the asset level our roofs are small relative to our building size, and many of our sites are constrained - old buildings with slopes, chimneys, etc. As a result, when we put solar on roofs, it offsets a component of the energy bill, but decarbonisation remains the main motivation.

We’ve explored a number of other avenues to reduce power price volatility for our tenants. A few years ago, we bought green energy and resold it to tenants. However, that model posed considerable corporate risk - if a tenant went bankrupt or moved out, we’d be left with significant unpaid bills. We also found there was a risk of green washing: the actual market difference between green and non-green energy contracts has blurred, especially with the proliferation of REGO certificates, which are often seen as having limited real value. We’ve since stepped back from directly buying energy for tenants but still require them contractually to buy green energy. Another option we explored was to develop infrastructure-scale projects ourselves where we would generate green power and buy it back via PPAs. Given the size and complexity of these projects, coupled with grid capacity restrictions, we found it challenging to justify.

Grid congestion is becoming a real constraint, particularly in Central London. It affects both development - getting grid capacity for temporary construction works - and the operation of new buildings. There’s a lot of complexity. For example, even if you have on-site renewables or battery storage, you’re still required to prove to the grid you won’t exceed your peak load if the on-site generation isn’t available.

So,for example, we recently explored removing all gas heaters from outdoor dining and replacing them with efficient electric heaters. But the grid capacity wouldn’t allow it in some cases. At a larger scale, if we were to retrofit whole streets, the grid load would be too high if it were done all at once. We asked a district network operator when we’d have grid capacity to connect a solar array of over 1MW, and the answer was 2037.

Next year, we’re conducting a study aimed at better understanding and unlocking grid capacity for commercial development in urban locations.

We want to work with network operators to understand: can we be more realistic about what is actually flowing through those nodes at any one time? Could we design the system with more redundancy? The idea is to reduce the impact of these constraints. We’re also working with local authorities on zonal retrofit approaches, which phase energy demand to avoid stressing the network all at once. Exploring these kinds of solutions is critical to unlocking greater resilience in our assets and portfolios.