Britain's grid upgrade delays could raise costs, NAO report says

LONDON, Sept 11 (Reuters) - Britain's National Audit Office said in a report on Friday that many upgrades to the country's electricity transmission grid are at risk of not being delivered and could increase short-term costs for consumers.

• Britain's energy regulator Ofgem estimates that £70 billion ($95 billion) of investment is needed to upgrade the transmission network between 2025 and 2031.

• When the grid cannot carry enough electricity from where it is produced to where it is needed, the National Energy System Operator (NESO), which runs it, intervenes to keep supply and demand in balance. This has normally meant paying gas plants or wind farms to turn off and gas plants to turn on.

• In 2025 to 2026, £1.9 billion was paid to generators to turn on or off their output to help balance the grid.

• However, the NAO said this could rise to £6.6 billion to £7.8 billion by 2030 if grid upgrades are not accelerated to match the new generation expected to come online.

• The NESO said 88 grid upgrade projects are needed by 2030 but the NAO report said 64 are at an early stage of development and are not expected to be completed by the due dates.

• "Delivering all the grid upgrades by 2030 will be very challenging. There remain significant planning, supply chain and system access risks and some of the projects are already forecast for delivery after 2030. This means some new generation is likely to connect before necessary grid upgrades are complete," the NAO report said.

($1 = £0.7390)

(Reporting by Nina Chestney; Editing by Hugh Lawson)