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Thumbs-up for Shetland Link

By: Tom Russell 20/03/2019 Ofgem

Cables General Grid Interconnectors Windfarms

The Office of Gas and Electricity Markets (Ofgem) has provisionally approved a proposal by Scottish and Southern Energy Networks (SSEN) to build a 600MW subsea electricity transmission link from Shetland to mainland Scotland.

Shetland’s current electricity needs are met from on-island sources, predominately Lerwick Power Station. As Lerwick Power Station is nearing the end of its operational life, there is a requirement to secure an alternative to meet future energy demand on Shetland.

The Shetland Link project is being developed to enable wind farms on Shetland to export renewable electricity to the rest of Great Britain and to improve the security of electricity supply on the islands. The approval is subject to the success off renewable energy projects in the upcoming Contracts for Difference (CfD) auction in May 2019.

SEN estimates the link would cost around £709 million and would be completed in 2024. Ofgem is consulting on approving the link subject to SSEN demonstrating, by the end of 2019, that the Viking Energy Wind Farm project planned for Shetland has been awarded subsidies through the UK Government’s CfD auction. Ofgem stated that this would protect consumers from the risk of paying for a link that it is bigger than needed.

This includes the Viking Energy Wind Farm which has an estimated capacity between 412-457 MW. The onshore array could consist of 103 wind turbines set around the central Mainland of Shetland. It is hoped the project will be operational in 2024.

If completed, the Western Isles link will consist of a single subsea circuit from Kergord on Shetland to Noss Head in Caithness on the Scottish mainland, connecting into SSEN’s recently completed Caithness-Moray transmission link.

Colin Nicol, Managing Director of Scottish and Southern Electricity Networks, said: “Ofgem’s decision to provisionally approve SSEN’s 600MW proposed transmission link is an important milestone in connecting Shetland to the mainland electricity network and helping to unlock its significant renewables potential.

“There are still a number of steps to be taken before we can proceed with the transmission connection, in particular the requirement for renewable developments to secure CfD support in this year’s auction, and we will continue to engage with key stakeholders during this consultation period.

“We also await clarity from Ofgem on their assessment of our proposed whole system solution. This decision will be important in reducing costs for consumers and securing the best economic case for delivery of renewable development in Shetland and Scotland’s other island groups.”

While it provided a positive reaction to SSEN's the Shetland Link projec, Ofgem also announced a provisional decision to reject another of SSEN's 600 MW interconnector projects. The decision was based on the risk of consumers paying for a significantly under-utilised link. For more information click here.

Ofgem has now opened a consultation on its Final Needs Case for both projects, for which responses will be gathered until 3 May 2019. It will make a decision on the business case for the projects in mid-2019.

For more information on interconnector projects worldwide, click here. Alternatively, you can view projects worldwide using 4C Offshore's interactive map.

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Thumbs-up for Shetland Link

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