Blog by David Gardner, Director of Transmission
As the owner of the electricity transmission network in the north of Scotland, Scottish and Southern Electricity Networks (SSEN), operating under licence as Scottish Hydro Electric Transmission plc, has a duty to develop and maintain an efficient, coordinated and economical electricity transmission system.
An important part of our job is to plan ahead to ensure our network meets the needs of its users and our investment decisions are taken in a timely and economic manner. Working with the System Operator (SO), National Grid, and the other GB Transmission Owners (TO), we continually review the potential transmission network requirements arising from different scenarios for future demand and generation looking ten years ahead and beyond. This allows us to identify parts of the network that may need strengthening or additional support, and begin work on the long term investments needed to meet the future requirements of our demand and generation customers.
How we do this forward planning is changing. Ofgem is in the process of implementing changes in the electricity industry to introduce more competition into transmission delivery and ownership. As part of this, the SO has been given an enhanced role including an obligation to undertake an annual Network Options Assessment report (NOA).
The NOA report takes information from each of the three TOs about their transmission network plans. It combines this with future generation and demand scenarios and carries out a GB wide cost benefit study to allow the SO to make independent recommendations about what it considers the optimal sequence and timing of transmission investments. Through this process the SO considers the interactions and timing of multiple reinforcement options across a wide geographical area. So whilst a reinforcement may be required to alleviate local constraints and appear economic on this basis, the NOA process may conclude in one year that, from a GB wide perspective, its timing is not optimal or that no decision is required that year. For those reinforcements that NOA recommends are put on hold or delayed, the SO may be signalling that it is more economical at this time to pay for the management of the constrained network than to proceed towards building new transmission infrastructure.
These changes in how we collectively approach the development of the GB electricity transmission system are intended to result in the best value transmission network for energy consumers across GB, a principle we strongly support.
National Grid has published the second of its annual Networks Options Assessment (NOA) reports. A large amount of analysis has gone into the production of this report and our System Planning team has been closely involved throughout. The NOA report makes recommendations for transmission projects across GB on the basis that they should either “proceed”, “delay” or “do not proceed”.
For SSEN, this year’s NOA report includes a change to the recommendation on the potential 400kV reinforcement project between Beauly, Blackhillock and Kintore that we have been developing to transport renewable energy from the north of Scotland. In last year’s NOA report the project was recommended to “delay” such that it could be delivered one year later than originally planned. However, in this year’s NOA report the project recommendation has changed to “do not proceed” which indicates that we should pause work on the project.
We note this outcome from this year’s NOA and will now begin discussions with affected parties (including generation developers and local communities) about how to take forward the recommendations.
As the NOA is an annual process, a recommendation can change year-on-year as generation and demand scenarios change and transmission development plans evolve. As such, a signal to stop or delay in one year might become a recommendation to proceed in later years. So central to our planned discussions will be how to ensure we capture the significant development work that has been done and the valuable stakeholder feedback received so far on this project.
We are working hard with our industry colleagues to develop the NOA methodology and understand and share the implications for our customers. When combined with the wider development of smarter grids, the way our electricity networks are required to perform and develop is changing fast. It is an exciting time and SSEN is making a real contribution to that change.