Subsea cable delay could take years 25/3/13
The Scottish Government is to intervene in the row over the threatened Western Isles
subsea energy cable.
The project risks being delayed for years unless unless the go-ahead for the underwater
link between Lewis and Ullapool is formally agreed soon.
Scottish and Southern Energy (SSE) which is the monopoly operator of the national
grid in North Scotland has yet to lodge a revised needs case, which looks at the
economics and business demand for the link, required before energy regulator Ofgem
can give final approval.
The delay means an arrangement between SSE and Swiss-owned submarine cable contractor
ABB could fall, necessitating re-running the time-consuming tender process. Demand
for copper in the growing Asian markets could also create a shortage of cable.
Ofgem has asked SSE for an urgent update on its plans.
SSE says it is holding back for a forthcoming report on tackling the high transmission
charges for exporting power from the Scottish islands.
The energy giant previously said the fees to export electricity down the link would
be more expensive under the revised project.
Energy Minister Fergus Ewing is now taking up the Western Isles fight to pressurise
grid operator SSE into submitting its revised business case to energy regulator Ofgem.
Island delegates at the Convention of the Highlands and Islands taking place in Lerwick
today were told of the energy minister’s involvement.
Western Isles Council leader Angus Campbell welcomed Mr Ewing’s support.
Mr Campbell said the transmission fees issue were beyond SSE remit for the cable’s
economic needs study.
He added: “There are only tow to three months for Ofgem to approve the cable. It
has to be done by June or July.
“SSE is leaving it a bit late.”
Mr Campbell stated: “SSE has enough data to submit the needs case.”
SSE’s previous economic appraisal highlighted that a second cable would be required
on the same route given the “significant increase in renewable generation on the
Western Isles.”
All major windfarm projects in the islands hinge on the interconnector being built
to enable electricity to reach southern markets.
A threat to the cable by rising costs was flagged up by Hebrides News last year.
Later SSE formally postponed the cable saying it would submit a fresh economic assessment
of the project to Ofgem.
The grid company made the first stage of a funding request to the Ofgem last April
but doubling of costs to £775 million put it in doubt.
This is the second time the subsea cable has been delayed. In 2010, the plans were
suspended because the developers at the time did not financially back the link so
it could not conclude a contract for the supply of the necessary electricity cable.