Eclipse Power buys Vattenfall Networks for net-zero heat network

Welcome to Net Zero News, where we bring you the latest developments driving the UK’s transition to a net-zero future. In a significant step towards cleaner electricity networks, Eclipse Power Group has agreed to acquire the independent distribution network operator Vattenfall Networks.

Net Zero News can reveal that Eclipse Power Group has entered into an agreement to acquire Vattenfall Networks, a licensed IDNO operating across multiple regions of the UK. The deal, announced in November 2025, will see the specialist network operator change ownership pending the usual regulatory approvals. The transaction involves the full transfer of Vattenfall Networks’ assets and operations to Eclipse Power Group.

Vattenfall Networks, originally part of the Vattenfall energy business, was established to develop and maintain electricity distribution infrastructure, connecting both generation assets and end users. As an IDNO, it has delivered tailored network solutions that integrate renewable generation sites, industrial connections and residential developments. Eclipse Power Group, which specialises in energy infrastructure investment and operation, will take on the network’s existing portfolio and staff, positioning itself as a key player in the expanding low-carbon grid sector.

The acquisition underscores a growing focus on enhancing the UK’s electricity distribution framework to support decarbonisation targets. The UK government has committed to achieving net-zero greenhouse gas emissions by 2050, with an interim goal of a 68% reduction by 2030. Upgrading and expanding distribution networks is critical to accommodate increased volumes of renewable generation, electric vehicle charging demand and emerging low-carbon technologies.

This development matters for the UK’s net-zero goals because strengthening network capacity and resilience will unlock further renewable energy projects and accelerate the shift away from fossil-fuel dependence. By consolidating Vattenfall Networks’ experience in connecting solar, wind and battery storage facilities, Eclipse Power Group aims to improve operational efficiencies and reduce network losses. Enhanced network performance can directly lower carbon emissions associated with electricity transmission and distribution losses.

Furthermore, the deal is expected to safeguard existing jobs and potentially create new opportunities in network maintenance, engineering and project management. Local supply chains supporting network construction and connection services could also benefit from continued investment. Reliable and flexible distribution networks are vital to ensure that low-carbon solutions remain cost-effective and accessible to households and businesses across the UK.

The transaction is being financed through Eclipse Power Group’s own balance sheet and debt facilities arranged by its banking partners. No public funding or government grants are reported to be involved in the purchase. Vattenfall will exit the IDNO market following a strategic review of its asset portfolio, while Eclipse Power Group will integrate the acquired network into its broader infrastructure holdings.

This agreement aligns with wider policy drivers including Ofgem’s network price control framework, which incentivises distribution companies to support net-zero delivery and innovation. Ofgem’s RIIO-3 regulatory period emphasises investment in smarter, greener networks, encouraging operators to adopt digital monitoring, automated fault detection and flexible connection solutions. Eclipse Power Group has indicated its intention to leverage these incentives to modernise the Vattenfall Networks assets.

The acquisition also complements the government’s British Energy Security Strategy, which highlights the importance of robust electricity infrastructure in delivering energy independence and decarbonisation. As the UK scales up offshore wind, solar PV and energy storage, distribution networks will need to adapt rapidly. By consolidating expertise under Eclipse Power Group, the sector anticipates improved coordination of network expansion and customer connections, reducing lead times for renewable projects.

Local communities served by Vattenfall Networks may see more reliable electricity supplies and accelerated connection offers for new low-carbon generation and electric vehicle charging hubs. The integration process may present short-term challenges, such as aligning operational systems and regulatory reporting, but Eclipse Power Group intends to manage a seamless transition to minimise disruption.

Looking ahead, Eclipse Power Group expects to complete the acquisition in early 2026, subject to competition and energy regulator approval. The company will then commence a programme of network investment, targeting upgrades to ageing infrastructure and deployment of smart grid technologies over the next five years.

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