SSE Regulatory News (SSE)

SSEN Transmission welcomes Networks Options Assessment £5bn+ investment recommendation

SSEN Transmission - the electricity transmission owner for the north of Scotland and part of the SSE Group, the UK's clean energy champion - welcomes today's publication by National Grid Electricity System Operator (NGESO) of this year's Networks Options Assessment (NOA), which recommends the investment of over £5bn in electricity transmission infrastructure in the north of Scotland that will be critical for maintaining a pathway to deliver the UK and Scotland's net zero commitments and renewable targets.

This year's NOA sets out the strategic reinforcements that will be required to enable the forecast growth in renewable electricity across GB. It outlines the investments needed to alleviate constraints on the transmission system by providing the large bulk-transfer capability necessary to connect and transport renewable electricity generation from remote sources to areas of demand.

The NOA recommendations for reinforcements in SSEN Transmission's network region include:

· Two subsea high-voltage direct current (HVDC) links from Peterhead to England;

· A second HVDC link from Spittal in Caithness, connecting to Peterhead;

· Strategic onshore reinforcements to the north of Inverness and between Inverness and Peterhead.

These reinforcements are required under all credible future energy scenarios for net zero; are necessary to underpin the delivery of the UK Government's target of 40GW of offshore wind by 2030 target and its commitment to decarbonise the power sector by 2035; as well as the Scottish Government's 11GW of offshore wind and 75% emissions reduction targets by 2030.

These investments, subject to all necessary planning and regulatory approvals, support SSE's recently announced Net Zero Acceleration Programme, which set out plans to invest £12.5bn in the five years to 2026, or £7m every day.

SSE's Net Zero Acceleration Programme also set out a target range for SSEN Transmission's gross RAV of £8-10bn by 2031 with a path for gross RAV to reach £12bn by 2031 in the event of an acceleration of reinforcement expenditure. The investments signalled in this year's NOA and the clear need to accelerate reinforcements to unlock ScotWind provide a clearer line of sight of the investment pipeline and demonstrate tangible progress towards future RAV growth forecasts.

Rob McDonald, Managing Director of SSEN Transmission, said:

"This year's NOA report fires the starting gun for over £5bn of investment in grid infrastructure in the north of Scotland. This will be critical to enabling the growth of renewable electricity in the region needed to deliver net zero, including the first step in unlocking the vast increase in offshore wind expected following the recently announced outcome of the ScotWind leasing round.

"These investments will also provide huge economic opportunities for the north of Scotland and throughout GB, supporting hundreds of skilled jobs in the development and construction phases. Due to the scale of investment required in grid infrastructure, we believe there is a clear opportunity for Governments and industry to work together to encourage inward investment in UK supply chain manufacturing and skills development.

"In enabling the connection of indigenous, clean renewable electricity generation, these investments will also be crucial in reducing the UK's dependence on volatile global wholesale gas markets.

"We now look forward to working constructively with Government, Ofgem, the wider industry and our stakeholders to provide the timely, coordinated and efficient investment in grid infrastructure that is key to our collective net zero ambitions."

SSEN Transmission will now undertake a major programme of engagement with stakeholders and local communities to help shape the development of these reinforcements; as well as exploring with Government, industry and wider stakeholders the significant supply chain opportunities and associated economic growth these investments present.