Ofgem extends Orkney Transmission link deadline

4C Offshore | Tom Russell
By: 14/05/2021 Ofgem
The Office of Gas and Electricity Markets (Ofgem) has approved an extension to Scottish Hydro Electric Transmission’s (SHET’s) for the 220 MW Orkney subsea cable electricity link.

The
Orkney electricity link, estimated to cost around £260m, is being developed to allow new renewable energy projects on Orkney to send electricity to the rest of Great Britain via a subsea cable link to mainland Scotland.  

Back in September last year Ofgem set out that it would approve the Final Needs Case for the proposed 220MW transmission connection to Orkney, subject to developers on Orkney meeting a number of conditions. This included a condition that at least 135MW of new wind farm projects on Orkney either being awarded a Contract for Difference (CfD) or being judged likely to be developed by December 2021.

The project developers submitted a request in March 2021 that this deadline be extended by 12 months. In their application, developers noted that its request came as the result of several projects having faced delays in development and in the planning process related to the Covid-19 pandemic and that an extension would enable consented projects to bid into Allocation Round 4 for a CfD. It also outlined that it is hoped that an extension would allow time to consider the outcome of grid charging reforms in their financial viability proposals.

Ofgem has since announced that it has confined an an extension to the deadline for meeting the above conditions to 31 December 2022. It noted that the impact of the Covid-19 pandemic on the planning process and the delays to finalising grid charging reforms in particular are events that could not have been foreseen when the original deadline was established.


Ofgem also outlined that if at any stage it becomes apparent that there will be insufficient generation on Orkney to meet the 135MW threshold, it encourages Orkney developers to engage with SHET to discuss the possibility of submitting a revised Final Needs Case for a smaller transmission link.

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