Back to top
Reported by SSE on 5 October 2018

SSEN Transmission submits Needs Case for Shetland link

Scottish and Southern Electricity Networks (SSEN), operating as Scottish Hydro Electric Transmission under licence, has today submitted to the energy regulator, Ofgem, a Strategic Wider Works (SWW) ‘Final Needs Case’ for a subsea cable transmission link from the Shetland Isles to the Scottish mainland.

(Courtesy of SSE Plc)

Shetland is not currently connected to the main GB transmission system and operates as an islanded network, where the islands’ electricity needs are met from local generation.  As there is no capacity to connect new electricity generation the network, a new link to the mainland is required to enable renewable generators seeking to connect on Shetland to export electricity to the GB market.

Following confirmation from the UK Government to allow remote island onshore wind to compete in the next Contracts for Difference (CfD) auction in May 2019, there is now an opportunity to progress with the transmission reinforcement, subject to the success of Shetland renewable developers in the CfD auction and regulatory approval.

SSEN’s proposed solution would deliver a deliver a single 600MW subsea circuit from Kergord on Shetland to Noss Head in Caithness on the Scottish mainland, connecting into the Caithness-Moray transmission link which is currently under construction.

Dave Gardner, SSEN’s Director of Transmission, said:

“Today marks a significant milestone in providing a transmission connection to Shetland.  We believe our proposal represents a robust, economic case for reinforcement and provides the best possible opportunity to unlock Shetland’s renewable potential.

“The submission marks an important first step in the process, however successful delivery will be dependent on sufficient volumes of renewable generation capacity securing a CfD contract to underpin the investment case, in addition to regulatory approval and relevant planning consents.

“We would like to thank our generation customers and wider stakeholders who have helped inform the development of the Needs Case and we now look forward to working constructively with Ofgem as they review our submission.”

SSEN’s Distribution business, Scottish Hydro Electric Power Distribution (SHEPD), is also investigating further options to ensure long term security of supply on Shetland at the most affordable cost, following Ofgem’s decision to reject the Shetland New Energy Solution in November last year. SHEPD is in the process of assessing whether utilisation of the proposed transmission link to meet Shetland’s future energy needs would represent the best value for Shetland and GB consumers compared with alternative options, and will confirm findings in the coming months.

More information on the Shetland Transmission project can be found at http://www.ssen-transmission.co.uk/projects/shetland/

References

[1]

SSE Plc. Press release - SSEN Transmission submits Needs Case for Shetland link. URL: http://sse.com/newsandviews/allarticles/2018/10/ssen-transmission-submits-needs-.... [Date Accessed: 05/10/2018].

Transmission

15 Jan | Vattenfall and TenneT have signed agreements for the Hollandse Kust Zuid offshore grid connection

Grid operator TenneT and wind farm developer Vattenfall have signed agreements for the construction of an offshore grid connection for the Hollandse Kust Zuid I and II wind farms. The agreements concern the realisation of the connection and the transmission of electricity between the 700 MW wind farm of Vattenfall and the TenneT Hollandse Kust Zuid Alpha offshore platform.

Transmission

19 Dec | Smulders to build three offshore transformer modules for the Moray East wind farm

Siemens has awarded a contract for the construction of three offshore transformer modules (OTM) to Smulders. The project, situated off the Aberdeenshire coast in the North Sea, will be developed by EDP Renewables, ENGIE and Diamond Generating Europe.

Transmission

04 Dec | ABB commissions first digital substations in Italy

ABB Ability™ based technology to boost efficiency and enable supply of clean wind energy

Transmission

03 Dec | Green light for the construction of Seamade offshore wind farms

Tractebel is part of the Consortium that has been awarded a contract for the construction and installation of the Seamade offshore wind farms in the North Sea. The consortium will build the two high voltage substations, and their respective substructure, to be installed respectively in the Mermaid and the Seastar area.

07 Mar | SSE Renewables welcomes offshore wind sector deal

Leading offshore wind developer, SSE Renewables, has welcomed the offshore wind sector deal announced today.SSE Renewables has the largest consented offshore pipeline in Great Britain, the largest offshore market in the world, and has been involved in the development, construction and operation of offshore wind for over 15 years helping to bring long-term jobs and economic development to diverse parts of the country.SSE Renewables’ Director of Generation Development, Paul Cooley, said: “It is an exciting time for the offshore wind sector which has huge potential to contribute more to the country’s climate change goals.“We are working to maximise the value of our own pipeline and we welcome the Sector Deal as a long-term mutual commitment from government and industry to help harness the incredible wind resource that our coastlines offer and deliver significant economic opportunities.“An ambition of at least 30GW of offshore wind capacity is a fantastic start and we believe that we can go further and should aim to build as many offshore wind projects that are needed to help deliver decarbonisation.”SSE has proven its ability to develop, construct and operate industry leading offshore wind projects including the 504MW Greater Gabbard Offshore Wind farm (SSE share 50%) and the 588MW Beatrice Offshore Wind Farm (SSE share 40%), in some of the most difficult, deepest waters in the UK. Beatrice is due to be completed on time and on budget this Spring.SSE has a history of engaging constructively with the UK supply chain in all of our renewable projects to maximise the economic benefits. For Beatrice contracts were placed with companies and businesses across the supply chain including CS Wind’s Machrahanish factory for towers, Global Energy Group’s Nigg Energy Park for turbine assembly, JDR Cables based in Hartlepool for array cables, Siemens Gamesa in Hull for blade manufacturing and Wick-based GMR Henderson for the restoration and development of the operations and maintenance base.This year’s CfD auction presents a fantastic opportunity to replicate these benefits in other parts of the country should SSE’s Seagreen and Dogger Bank projects be successful.

01 Feb | Sale of stake in Stronelairg and Dunmaglass windfarms to Greencoat

SSE has agreed to sell a 49.9% stake in its Stronelairg and Dunmaglass wind farms to Greencoat UK Wind Plc ("UKW") in a £635m deal.The stakes equate to 160.6MW (megawatts) of capacity, with an average valuation for the two wind farms of around £4m per MW.  This valuation demonstrates SSE’s ability develop quality, low carbon assets and infrastructure vital to the GB energy market.The sale is in line with SSE’s strategy to create value from development and operation of renewable assets and recycle capital in the right opportunities. Gregor Alexander, SSE's Finance Director, said:  "Both Stronelairg and Dunmaglass wind farms are a testament to SSE’s ability to design, develop, construct and operate first class renewable energy assets.“Onshore wind makes a huge contribution to supplying low carbon electricity to the GB market and to meeting the UK’s carbon reduction targets.  The sale of stakes in these wind farms to Greencoat is a continuation of SSE’s longstanding approach of partnering and securing value for shareholders at appropriate times." SSE will continue to operate both wind farms while future development rights are in line with the equity share.  SSE owns the largest portfolio of renewables, by capacity, in the UK and Ireland and is a leading developer of clean energy technology. SSE intends to use up to £200m of the proceeds to fund a discretionary share buyback in accordance with the authority granted by shareholders at SSE's Annual General Meeting on 19 July 2018 . The remaining proceeds will be used to reduce net debt.The transaction is expected to complete by the end of March 2019.  Following this, and the completion of the Beatrice offshore wind farm (SSE share 40% or 235MW), expected in Spring 2019, SSE’s renewable generation capacity will be around 4GW (gigawatts) with an expected average annual electricity output of around 11.5TWh.Additional InformationStronelairg is 228MW, consisting of 66 Vestas 3.45MW turbines, with an expected annual load factor, on a P50 basis, of 42% and a build cost of £1.5m/MW. Dunmaglass is 94MW, consisting of 33 GE 2.85MW turbines, with an expected average annual load factor, on a P50 basis of, of 43% and a build cost of £2.2m/MW (including acquisition cost of the development). The average cost to build these assets was £1.7m/MW.  Both windfarms have 0.9/MWh Renewable Obligation Certificates which run to September 2036 for Dunmaglass and March 2037 for Stronelairg.SSE was advised on the UKW transaction by Rothschild & Co. and CMS.

29 Jan | Collaborating to deliver more offshore wind for Scotland

In November we announced our plans to bring together all our renewable energy activities in the UK and Ireland under a new entity, SSE Renewables. Creating this focused business fits with SSE’s vision of being a leading energy company in a low carbon world. My aim is to motivate and mobilise our highly skilled people to focus on efficiency and innovation, ensuring that renewable energy represents value for money.Back in 2004 we first dipped our toes into the Scottish offshore wind industry with the co-development of the Beatrice Demonstrator which was ground breaking at the time. Fast forward to now and SSE currently has the largest consented offshore wind pipeline in the UK and Ireland, some 3.3GW. During that time SSE has proven its ability to deliver and operate industry leading offshore wind projects. These include (with our partners) the 504MW Greater Gabbard offshore wind farm off East Anglia completed in 2012 and the 588MW Beatrice project in the Moray Firth where well over half of the turbines have been completed.Beatrice is bringing over £1.1bn of added value to UK GDP through its construction and around 90 long-term jobs to the far north east of Scotland at the operations and maintenance base in Wick, creating real economic development in the region. Looking forward, the future is bright for the Scottish offshore wind sector. We are progressing our Seagreen Phase 1 project, located in the Forth of Firth, which could be up to 1500MW. Of course, delivering the project will be dependent on the outcome of this year’s CfD auction, which will be the most competitive and challenging yet.Offshore wind is delivering where other low carbon technologies are facing challenges. Our view is that 1-2GW deployment a year, resulting in 30GW by 2030, should be the absolute minimum the UK’s ambition for offshore wind. It is certainly not an upper limit with the healthy pipeline of projects we are seeing come through in the UK. When the Committee on Climate Change reports back on its advice regarding the implications of a net zero target, something SSE supports, it is highly likely that we will need as much offshore wind as possible, as fast as possible. In that context it is somewhat counterintuitive that the UK government has decided to cap the amount of capacity which can be successful in the next CfD auction at 6GW. The Sector Deal, which should be announced soon, will set the industry on a new footing. The offer from the Sector is clear – multibillion pound investment in low carbon infrastructure which creates good quality jobs; innovation; regeneration and upskilling in areas of the country that need it most. We need to make sure that Scotland is at the heart of that Sector Deal. Both in terms of what it can offer and how it benefits. Certainly, more can be done to support the domestic supply chain. Leasing new Scottish seabed will help to unlock more offshore development. We welcome the Marine Scotland and Crown Estate Scotland leasing work and engagement in recent months. The final Scottish Marine Plan must maximise Scotland’s potential while also balancing other interests. Sites available for lease in future rounds need to include sufficiently shallow water areas where fixed foundations can be used. Deeper waters more suitable for floating technology holds a lot of potential in the longer term but in the near-term are simply not going to be competitive. We understand the concerns expressed by some around constraints and sensitive areas, and we as an industry have and can continue to work collaboratively with Marine Scotland and stakeholders to mitigate these concerns and find a successful way forward. As set out in the Sector Deal, we need to ensure that there is collaborative approach between governments and the industry to addressing all the barriers to deployment we currently see. Because without doing so, we will struggle to achieve our collective ambitions. SSE is up for the task and we are committed to seeing offshore wind thrive in Scotland and the UK more broadly. 2019 is set to be an exciting year but is just the beginning of the next phase.

24 Jan | Forget the nuclear woes, offshore wind can power us forward, By Alistair Phillips-Davies

At a time when solutions to the many problems facing the country seem few and far between, we should be grateful that in offshore wind we have got an ‘off the shelf’ answer to the problem of how the country can decarbonise energy cost effectively whilst securing new jobs and growth for the UK economy.Later this year our Beatrice Offshore Wind Farm, the largest project in Scotland will be completed, and fully exporting low carbon electricity to the grid. It is one of many projects delivered to time and budget, which have helped bring the costs down substantially. Last year the Energy Minister Claire Perry set out an ambition of an additional 1-2GWs of offshore wind per year during the 2020s taking the UK to a total of between 20 and 30GW, meaning it could be the generation technology with the largest installed capacity in the UK. The sector has responded, and an Offshore Wind Sector Deal will be finalised later this year setting out the industry’s substantial commitments to the Industrial Strategy. The question now is whether 30GW by 2030 is ambitious enough.In the coming months, the Government will receive advice from the Committee on Climate Change on the implications of increasing its decarbonisation target from an 80% reduction in emissions by 2050 to ‘net zero’. In light of the IPCC report last year, SSE supports the adoption of a net zero target, and the implications will be a need to go faster and harder on decarbonising electricity as the driver for decarbonising heat and transport. With the news that Hitachi has pulled out of the Wylfa project, the new nuclear programme looks in real trouble and was due to come in well above the costs of offshore wind anyway. Nuclear has a role to play but even with substantial government support on offer, I doubt its ability to deliver cost effectively in the 2020s. With onshore wind unfortunately unpopular with this Government that means offshore wind will need to do even more of the ‘heavy lifting’ to keep us on track with our climate change commitments.It is time to raise our ambition with offshore wind. We should be aiming to build as many offshore wind projects as needed to help deliver decarbonisation targets in power, heat and transport, rather than going down the route of Government’s recently imposed cap on low carbon contracts regardless of how competitively projects can bid. We have a technology that brings cheap, low carbon electricity. The North Sea is a perfect deployment area for it, with great wind speeds, over such a large area that offshore wind can contribute strongly to energy security. It is supported by the public and the jobs and opportunities from development and operations are in communities that really need them. It is time to aim higher and seize the opportunity that offshore wind brings.