Scottish and Southern Electricity Networks Transmission (SSEN Transmission) has resubmitted to the energy regulator, Ofgem, its investment case (Needs Case) for the proposed transmission link to Shetland.

By connecting Kergord on the Shetland Isles to Noss Head on the Scottish mainland, the transmission link enables new renewable electricity generators on Shetland to export low carbon electricity to the GB market. It will also help secure Shetland’s future electricity security of supply, with Lerwick Power Station, Shetland’s main current power source, expected to cease full operations in 2025. The link is scheduled to be energised and operational by April 2024.

By unlocking Shetland’s renewables potential and providing the islands access to the main GB transmission system, the link will also facilitate the supply of low carbon electricity to Shetland’s oil and gas industry at a time when the sector is actively exploring ways to decarbonise its electricity demand requirements.

Updated with the latest economic analysis, SSEN Transmission is seeking regulatory approval for a 600MW transmission link, conditional on the main driver for the link, Viking Wind farm (457MW), reaching a positive Final Investment Decision.

Commenting on the Needs Case, Rob McDonald, Managing Director for Transmission, said:

“We have submitted a robust investment case to Ofgem which makes it clear that a 600MW link remains the most economic, efficient and timely option to secure Shetland’s future energy needs.

“As well as providing a connection for Shetland’s renewables, the link will also help address Shetland’s security of supply needs as well as offering Shetland’s oil and gas sector a unique opportunity to decarbonise its operational electricity requirements, delivering a whole system approach to support the transition to net zero emissions.

“Whilst we have listened to calls to consider delaying investment to develop a bigger link, our analysis shows that a bigger link would not be economic or efficient and would create a delay of at least two years, jeopardising the potential of any transmission link to Shetland proceeding.  

“We now look forward to working constructively with Ofgem, our contracted developers and other stakeholders to progress the transmission link in a timely manner.”

NOTES:

  • In March 2019, Ofgem published its minded to decision to approve the Shetland Needs Case for a 600MW link, conditional on Viking wind farm (457MW) securing a Contract for Difference (CfD). https://www.ofgem.gov.uk/publications-and-updates/ofgem-approves-shetland-link-and-would-support-alternative-western-isles-link-proposal-provides-better-value-money-consumers
  • Following the outcome of the 2019 CfD, in which Viking was unsuccessful, Ofgem published an update asking developers and SSEN Transmission to demonstrate the continued need for the proposed links. https://www.ofgem.gov.uk/system/files/docs/2019/10/update_on_the_shetland_final_needs_case.pdf
  • Ofgem also asked SSEN Transmission to consider whether an alternative size of link or alternative conditions for approval should be proposed.
  • Supported by analysis by the Electricity System Operator, the updated Needs Case demonstrates that a 600MW link remains the most economic, efficient and timely option. In the absence of a CfD for Viking, SSEN Transmission is seeking conditional approval, subject to Viking reaching a positive Final Investment Decision.
  • Separately, SSEN Transmission continues to engage with Western Isles generators and other stakeholders as part of the Western Isles Needs Case process and expects to provide an update to Ofgem and other stakeholders in the coming weeks.

 

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