16th Dec 2014 07:00
OFGEM CONFIRMS FUNDING FOR £1 BILLION TRANSMISSION SUBSEA LINK
Ofgem has today approved £1.1 billion funding for a new subsea link in the north of Scotland. The regulator's decision is £105 million less than the funding request from Scottish Hydro Electricity Transmission (SHE Transmission) to ensure consumers pay no more than necessary.
The new link will connect 1.2GW of new renewable electricity generation following completion in 2018. This additional capacity will increase the resilience of Britain's energy infrastructure. It will connect the electricity grid on either side of the Moray Firth.
Notes to editors
1. Ofgem's decision letter on the Caithness Moray transmission project www.ofgem.gov.uk/publications-and-updates/decision-our-assessment-caithness-moray-transmission-project
2. Cost of project
SHE Transmission | Ofgem | |
Proposed efficient costs (October 2014) | £1,236 million | £1,062 million |
Updated proposed efficient costs | £1,223 million | N/A |
Final funding decision (December 2014) | N/A | £1,118 million |
Ofgem's lower cost assessment is based on a range of analysis including unit cost benchmarking, a detailed review of some costs, comparisons to similar projects, and a review of SHE Transmission's procurement strategy and processes.
The final funding decision is £56 million more than Ofgem's view in October. This follows consultation responses and new information provided by SHE Transmission.
3. For further press information contact:
Dafydd Wyn: 020 3263 9943Mark Wiltsher: 020 7901 7006
Out of hours media contact number: 07766 511470
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