New positive sign for Isles’ interconnector

The approval by OFGEM of a 600mw transmission link for Shetland has been welcomed by the leader of Comhairle nan Eilean Siar as ‘a very encouraging sign’ as it works to secure the energy regulator’s backing for a similar link for the Western Isles.

Last week Ofgem approved the proposal by Scottish and Southern Electricity Networks (SSEN) to build the SSE Viking development which will provide a subsea electricity transmission link from Shetland to mainland Scotland and which will allow new wind farms on Shetland to export renewable electricity to the rest of Great Britain.

Ofgem’s approval for the SSE Viking development is though subject to it receiving ‘sufficient evidence’ by the end of 2020 that the 457MW Viking Energy Wind Farm project planned for Shetland is likely to go ahead.

The Comhairle this week described the SSE Viking development as being ‘very similar’ to that proposed for the Western Isles.

In March 2019, OFGEM issued a ‘minded to’ position with respect to transmission links in Shetland and the Western Isles, saying that both links could be approved for funding if their anchor developers – SSE Viking in Shetland and Lewis Wind Power and Uisenis in the Western Isles – were successfully awarded ‘Contracts for Difference’ in the November 2019 Allocation Round.

But that backing was not secured by either SSE Viking or Lewis Wind Power and subsequently OFGEM later revised its position to state that the links might still be approved if the developers could demonstrate their financial viability.

In a statement, Comhairle nan Eilean Siar said this week that it took ‘encouragement’ that SSE Viking had been able to demonstrate to OFGEM that its Shetland Wind Farm could be viable without a Contract for Difference.

A spokesperson for the Comhairle said that developers in the Western Isles were ‘following the same trajectory’ as SSE Viking, and were currently compiling evidence on Wind Farm viability “and anticipating some welcome market developments which will enhance this viability” including ‘cost saving modifications’ to the Transmission Charging ‘regime’ and “a helpful reorientation of the 2021 Contract for Difference Allocation Round which remains open to Remote Island Wind developers”.

Comhairle Leader, Cllr Roddie Mackay, said: “Approval of the Shetland cable by OFGEM is a very encouraging sign.

“Our developers remain fully engaged and a great deal of work is going into building the evidence that will convince OFGEM to approve the Western Isles link in the same way.

“The Western Isles case is strong and becoming stronger as revisions to the Transmission Charging regime come on stream and as we look towards the next Contract for Difference Auction in 2021 when it looks like Remote Island Wind developers will be in a competitive position to win contracts”.

Jonathan Brearley, chief executive of Ofgem, said: “Ofgem’s immediate focus is to support the energy industry so it can respond effectively to the COVID-19 pandemic and ensure consumers, especially the vulnerable, are protected.

“[This] announcement will help stimulate economic growth as the economy recovers from COVID-19, as well as unlocking Shetland’s potential to supply low cost renewable electricity for consumers across Great Britain.”