Final Project Assessment of the IFA2 interconnector to France
Decision
- Publication date
- Industry sector
- Transmission Network
Related links
- Cap and floor regime: Initial Project Assessment for the FAB Link, IFA2, Viking Link and Greenlink interconnectors
- Cap and floor regime: Open letter on procedural changes to our Final Project
- Decision on the Final Project Assessment of the NSL interconnector to Norway
- Decision on the Initial Project Assessment of the FAB Link, IFA2 and Viking Link interconnectors
- Decision to roll out a cap and floor regime to near-term electricity interconnectors
- The regulation of future electricity interconnection: Proposal to roll out a cap and floor regime to near-term projects
The cap and floor regime is the regulated route for interconnector development in GB. There are three main stages to our cap and floor regime – the Initial Project Assessment (IPA), the Final Project Assessment (FPA) and the Post Construction Review (PCR). Following our IPA of the IFA2 interconnector we decided to grant the project a cap and floor regime in principle In July 2015.
The IFA2 project is being jointly developed by National Grid Interconnector Holdings (NGIH) and by RTE, the French transmission system operator. It will be a 1 GW interconnector between Chilling, Hampshire in England and Merville-Franceville-Plage in France. Our cap and floor regulatory regime applies to National Grid’s 50% share of the cost and revenues of the project.
As part of the FPA process, we conducted a cost assessment of the IFA2 project and set out our view on efficient expenditure which informs the project’s provisional cap and floor levels. We also provided confirmation of the cap and floor regime design as well as the financial parameters that apply to the IFA2 project.
This paper is our decision on the FPA of the IFA2 interconnector. This sets the provisional cap and floor levels at £50.7m and £27.6m (in 2016/17 prices). We will modify IFA2’s interconnector licence to give effect to our decision. We will then confirm the final cap and floor levels for the project prior to operation at our PCR stage.