REGULATORS have given the go-ahead for the single biggest investment in Scotland’s green energy sector in decades, which will bring more renewable electricity to homes across the country.
The £1.2 billion subsea connector in the Moray Firth is expected to pave the way for future wave and tidal energy generation in remote locations and help Scotland meet its ambitious CO2 reduction targets.
The project could see enough new renewable energy schemes linked to the national grid to power the equivalent of 637,500 homes.
The 100-mile line, between Caithness and Moray, will be installed by SSE subsidiary Scottish Hydro Electric over the next four years. Experts said it could unleash more than 1.2GW of renewable energy projects.
Until now, it has been difficult for energy firms to plan projects in the far north because of the lack of connections to the main grid. Firms supplying energy far from population centres are penalised due to the costs of transmitting the energy. In contrast, some in England are paid for doing so. Ofgem also announced grid charges for green electricity generators in Scotland will be reduced from April 2016.
This will cut costs for companies planning projects north of the Border and generate savings which could ultimately be passed down to consumers.
First Minister Alex Salmond yesterday said that more than 600 jobs may be supported in the construction of the connector, which he said would help meet renewable targets at a lower cost to consumers.
He said: “Today’s announcements are welcome news for the Scottish electricity sector and consumers.
“They support the transition to a low-carbon economy by encouraging renewable generation in the areas of highest resource and ensure Scotland continues to play a vital role in delivering security of electricity supply across these islands.”
He added Ofgem’s decision to “reduce the level of discriminatory grid charges for electricity generators in Scotland” was “particularly welcome”.
Last year, investment in renewables projects in Scotland was worth almost £1.2bn, according to figures from Scottish Renewables.
Martin Crouch, senior partner for transmission for Ofgem, said the decision was “a major step forward” for renewable energy.
He said: “This means that the company can move forward with work on the upgrade.”
Scottish Hydro Electric said that construction work should begin in the next few months and is expected to be completed in 2018.
The scheme represents the largest investment in the region’s electricity network since the hydro era of the 1950s.
Mark Mathieson, managing director of Scottish Hydro Electric Transmissions, which is owned by Perth-based energy giant SSE, said: “We will now work with Ofgem on the remaining details and focus on ensuring that the benefits it will bring in unlocking renewable sources of energy for decades to come are realised.”
The current system charges energy suppliers more for electricity generated further away from the “centre” of the grid, penalising those in the north of Scotland.
In contrast, some firms in the south of England, close to major population centres, are paid to transmit energy into the grid.
Around 12 per cent of total “transmission-connected” capacity in the UK for the coming year is located in Scotland but generators north of the Border will pay 35 per cent of the charges.
Lang Banks, director of environmental body WWF Scotland, said: “Given the urgent need to cut climate emissions and keep the lights on, it’s bizarre we’ve had a system that has effectively penalised some of the best locations for renewable energy.”
He added: “Scotland already generates about a third of the UK’s entire renewable electricity needs and has the potential to contribute more now that this agreement is in place.”