Three major UK electricity “superhighways” could move ahead sooner than expected to help limit the amount that households pay for windfarms to turn off during periods of high power generation.
Current grid bottlenecks mean there is not enough capacity to transport the abundance of electricity generated in periods of strong winds to areas where energy demand is highest.
The new high-voltage cable projects linking windfarms in Scotland and off the North Sea coast to densely populated areas in the south of the country could start operations by the early 2030s rather than towards the end of the decade, according to the sector regulator.
This should help to cut the rising cost of paying windfarms to turn off when they generate more electricity than the grid can transport. Without better interconnection these payments, which consumers cover via their energy bills, are expected to reach more than £12bn a year by the end of the decade.
Under Ofgem’s plans, National Grid and SSE will be allowed to begin early investment on two Eastern Green Link subsea power cables to transport offshore windfarm electricity to the south by 2034.
They will also be allowed earlier investment for the 75-mile (120km) GWNC electricity link between Grimsby in Lincolnshire and Walpole in Norfolk to help transport the energy to consumers from 2033.
Ofgem says bringing forward the superhighway projects will mean consumers are between £3bn and £6bn better off compared with the later delivery date, in large part because it will reduce the almost £2bn paid each year to generators to cut their output when the grid is overloaded.
Fast-tracking the projects is expected to bring forward higher costs on consumer energy bills to pay for the work, however, days after the regulator gave the green light for companies to spend £28bn on Great Britain’s gas and electricity grids.
An Ofgem spokesperson was not able to say what the direct impact would be on energy bills, or when it would take effect.
The regulator’s decision is also expected to put the energy industry on a collision course with disgruntled local communities that have opposed the grid projects over concerns about the expected disruption of the building work and the long-term industrialisation of the countryside.
Ofgem’s director of major projects, Beatrice Filkin, said: “We’re neither handing [energy companies] blank cheques nor greenlighting the projects themselves, that is rightly for the relevant planning authorities to decide. Through intelligent use of early investment and setting realistic but ambitious timescales, we are helping shield consumers from unnecessary costs.”
She said fast-tracking the projects would put them in a prime position to compete in the global race for the supply chains needed to upgrade grids as all major economies turn away from fossil fuels to power their economic growth.
The European Commission is poised to unveil a €1.2tn (£1.05tn) plan to upgrade the EU’s electricity grids later this week, according to Euronews, including eight key projects designed to strengthen the bloc’s energy security. The commission expects to spend about €730bn on distribution networks and €477bn on transmission grids, the report said, citing a leaked document.
