Ofgem gives provisional green light to projects to power millions of homes
Press release
- Publication date
- Industry sector
- Transmission Network
- Licence type
- Electricity Interconnector Licence
- Electricity Offshore Transmission Licence
Plans for two high voltage cable links to Europe which could help power millions of homes and harness the power of the North Sea have been recommended for approval by energy regulator Ofgem.
The projects being considered would provide more capacity for both exporting and importing energy, something which is needed as Great Britain moves toward a net zero energy system, which is more reliant on intermittent sources of generation such as wind and solar power.
Interconnection with European grids can help cut down on costs and waste by providing routes to sell excess clean power to the continent, for example during times when wind farms are generating more electricity than can be used, and to access power to meet electricity demand during times when energy supply here is more limited, such as during times of low wind.
The regulator has launched two separate consultations on its minded to position to fund the following projects:
- LionLink, a first of its kind electricity link which would not only link the British and Dutch power grids, but also connect Britain’s grid directly to Dutch wind farms in the North Sea. This so-called Offshore Hybrid Asset (OHA) could provide 1.8GW of electricity capacity.
- Tarchon Energy interconnector which would provide a direct power link between Germany and Great Britain. The 1.4GW 610km cable could provide 1.4GW of electricity capacity.
A gigawatt (GW) is equivalent to one billion watts, and one gigawatt hour (GWh) of electricity is enough to power one million homes for one hour.
An interconnector is an undersea high voltage cables connecting GB’s electricity transmission network to European markets via point-to-point connection, allowing power to be both exported and imported.
Great Britain currently has 11.7GW of interconnection capacity already operational or under construction today, and LionLink and Tarchon could add a further 3.2GW of capacity.
Rebecca Barnett, Ofgem Director of Major Projects, said:
“Interconnectors can make energy supply cleaner, cheaper and more secure. It’s a win-win and helps further harness the vast potential of the North Sea. We can sell our excess clean power to Europe, when we generate more than we need, or access power to meet electricity demand in Britain, during times when energy supply here is more limited.
“We’ve assessed all the proposed projects on their individual merits against our published criteria and recommended regulatory support for the ones which we believe will deliver for consumers in terms of energy security and the economy.”
Ofgem is also consulting on its current view not to approve another proposed OHA asset, and a further six proposed interconnectors, which have not thus far sufficiently convinced Ofgem that they meet the requirements for approval.
Ms Barnett added: “We have a robust, detailed and transparent process for approving interconnectors and OHAs. However, we’ve not made any final decisions. Those projects not currently recommended for regulatory support can make their case in this consultation, their submissions will be considered along with any other feedback given.”
People can get involved with the consultation by sending responses to Cap.Floor@ofgem.gov.uk
The consultations are due to close on Tuesday 30 April 2024. Ofgem will look to finalise its decisions regarding funding of the projects in summer2024.
Notes to editors
View the Offshore Hybrid Asset consultation.
View the electricity interconnector consultation.
Ofgem sets very high standards for approving projects – if projects are not likely to be successful, it is households and businesses who pay for it on their bills – and Ofgem will only back projects which can demonstrate they benefit consumers.
Interconnectors are subsea high voltage cables connecting GB’s electricity transmission network to European markets via point-to-point connection, allowing power to be both exported and imported. Interconnectors provide conduits for importing and exporting energy, meaning rather than GB having to pay generators to turn off, during times of excess generation here, British generators have the potential to instead export our excess electricity overseas. Conversely during times of less generation, they give us more options for importing electricity from a range of markets.
- Ofgem is recommending regulatory support for the Tarchon Energy interconnector which would provide a direct power link between Germany and Great Britain. The 1.4GW 610km subsea cable would deliver upto 1.4GW of electricity capacity. The cable would connect the two countries energy markets and enable renewable energy to be exported, at times when generation exceeds demand, thereby boosting security of supply and cutting consumer bills, by reducing payments to wind farms to switch off during times when they are generating more electricity that can be used domestically.
- Ofgem is currently not minded to recommend regulatory support for six further proposed interconnector projects (Aminth, AQUIND, Cronos LirIC MaresConnect and Nu-Link) as thus far they have not been judged to have demonstrated that they deliver value for consumers.
Innovative Offshore Hybrid Asset (OHA) interconnectors, combine interconnection with the transmission of electricity generated by offshore windfarms and create direct links between power grids and windfarms. OHAs can improve coordination of offshore wind and interconnection and are an important first step towards a more strategic meshed electricity system in the North Sea. They can reduce build and operation costs, and by coordinating infrastructure they have the potential to reduce impacts on the environment and on communities.
- Ofgem is recommending regulatory support for LionLink, a first of a kind electricity link which would connect offshore wind between the UK and the Netherlands. National Grid Ventures and Dutch partner TenneT’s innovative proposed Offshore Hybrid Asset (OHA), combines grid interconnection with the transmission of electricity generated by offshore wind farms. The project would connect Dutch offshore windfarms to the GB grid, providing up to 1.8 gigawatts of clean electricity,
- Ofgem is currently not minded to recommend regulatory support for another proposed OHA interconnector, Nautilus, as thus far it has not been judged to have sufficiently demonstrated its consumer value.