Miles of cable, pipes and electrical wiring will be replaced in the 313-year-old palace, considered a "working" national monument. The British monarch will remain in residence while repairs are completed over the next 10 years.
Palace officials said the $458 million price tag will likely be reduced to about $375 million with benefits and adjustments for inflation. The work will be funded by a 10 percent increase in the Sovereign Grant, the funding mechanism used by the British government for the queen's operating costs.
Some of the aging infrastructure, such as 60-year-old electrical wiring, "needs immediate attention to reduce the very real risk of fire and failure," officials said. Other problems include the palace boilers, which are more than 30 years old.
"This will continue to compromise the ability to provide acceptable living conditions, maintain the desired temperatures to preserve the works of art in the royal collection which are on display within the palace, to provide compliant office working conditions for royal household employees and achieve energy efficiency," grant trustees said of failing boilers.
The palace has 775 rooms, including 188 staff bedrooms and 78 bathrooms. Some 50,000 tourists visit the palace each year and another 50,000 visit as state guests. The work is expected to begin in April.