Power strategy becomes a competitive advantage
How do we ensure buildings have access to sufficient, affordable electricity when they need it, despite growing costs, demand and network constraints?
03 November 2026
WHAT CHANGED
The Budget kept energy firmly in focus, but much of the detail and delivery is still to come. Alongside GB Grid and expanded self-build connections, it reinforces why power strategy needs to move to the forefront of real estate decisions.
WHAT THIS MEANS
The Budget combined immediate action on energy costs with a clearer direction for longer-term reform. Household measures dominated the headlines, while support for businesses was more limited, including the confirmation of the backdating of the British Industrial Competitiveness Scheme. But for property, the more consequential measures may be those aimed at tackling the availability, cost and delivery of power.
The pre-Budget announcement of GB Grid, alongside proposals to expand self-build transmission connections, could help accelerate network investment and give customers and private capital greater scope to deliver infrastructure. Data centres were also singled out for a “New Deal”, aimed at accelerating grid connections and allowing onsite generation while projects wait to connect, subject to wider commitments. The £2 billion Energy Wealth Fund, intended to channel tax revenues from new gas projects into clean energy investment, provides a further signal of the government’s commitment to expanding domestic energy infrastructure, although its impact will depend on how and where the funding is deployed. Together, these measures reinforce a shift towards developers taking a more active role in securing the power their buildings require.
That matters beyond the most power-intensive sectors. Electrification, EV charging, digital infrastructure and changing occupier requirements are increasing electricity demand across the built environment. Proposed Minimum Energy Efficiency Standards (MEES) requirements could add further impetus, with a minimum EPC B proposed by 2031 for larger buildings over 1,000 sq m, around half of relevant floorspace currently falling short. This is likely to accelerate investment in electrified heating and cooling as owners seek to reduce operational emissions and energy use while ensuring buildings have sufficient power capacity.
While power availability is often the focus, affordability remains equally important. Non-domestic electricity prices were around 77% above their 2019-21 average in Q2 2026, while gas prices were approximately 98% higher, according to DESNZ data. Although below the peaks reached during the 2022 energy crisis, these costs continue to influence occupier decisions, building operations and business competitiveness. The Budget concentrated most of its direct relief on households, leaving many businesses exposed to elevated energy costs outside the sectors covered by the British Industrial Competitiveness Scheme.
The market has already begun responding. Prior to the Budget, there has been a growing focus on "bring your own power" strategies, ranging from rooftop solar and battery storage through to larger-scale on-site energy infrastructure as well as indirect routes with corporate power purchase agreements (CPPAs) on the rise. Energy infrastructure is also becoming an increasingly common component of planning applications for large and mega developments, reflecting the need to secure capacity as part of development strategy rather than after the event.
The implication for owners and developers is increasingly clear: power strategy needs to sit at the forefront of building strategy.
Understanding future demand, connection capacity, onsite generation, storage and procurement early can help ensure buildings are ready for electrification, attractive to occupiers and resilient to future energy constraints.
BOTTOM LINE
The real estate sector has spent the past decade focusing on energy efficiency. The next decade may be defined by energy availability as well as cost. As occupiers electrify operations and power requirements increase, the question is whether it has sufficient capacity for future demand. In this environment, power availability risks becoming the next source of real estate obsolescence.
Energy costs were front and centre in the budget. Whilst it is welcome that some cost-saving measures were announced for more vulnerable domestic customers, it doesn’t change the fact that many business energy users are staring down the barrel of 15-20% cost increases in 2027. What was made very clear from the energy announcements around the budget is that cost reduction is (belatedly) the Government’s primary focus and to enforce this the Treasury has taken over control of UK energy policy from DESNZ. Subsidies must not increase costs for bill-payers and decarbonisation cannot any longer be a cost passed on in full to energy users. This is a welcome acceptance by Government of a reality that has been clear for a number of years, namely that without reducing energy costs UK economic growth will be substantially impaired for years to come. Whilst the detail is still to come, it is a welcome and important step to see some clear messaging from Government on energy policy priorities – costs to consumers must be lowered and generation capacity must be increased.
Dive deeper into our Autumn Budget insights for expert perspectives on what the changes mean for commercial real estate.
