Consultation on the proposals started today which include £5bn of cash over the next price control period from April 1 2013 – 2021.
The announcement was followed within minutes by confirmation of plans for a £9bn boost to the nation’s railways.
Around £15bn of the energy total is earmarked for the upgrade and renewal of the high voltage electricity network in England and Wales and the high pressure gas networks across Britain.
These networks are operated by National Grid and the package would fund major projects such as new sub-sea electricity cables linking England/Wales and Scotland.
Ofgem believe the building of these critical infrastructure projects could create around 7,000 jobs, mainly in the construction supply chain.
An estimated £7bn would help to ensure that low pressure gas networks, which deliver gas to homes and businesses, remain safe and reliable.
The money would fund the continued maintenance across Britain of the gas distribution network, in particular the gas mains replacement programme.
Ofgem Chairman, Lord Mogg said: “Britain faces an unprecedented need to invest to replace ageing infrastructure, meet environmental targets and deliver secure supplies.
“This needs to be carried out at a time of global financial uncertainty, which makes attracting investment difficult but possible.”
The plans will lead to household bills being around £7 higher in 2013, rising to around a £15 increase in 2021.
The average increase on annual household bills across the eight years of the price control is around £11 compared to this year.