LONDON, Nov 15 (Reuters) – The British energy regulator Ofgem announced on Friday the approval of a £2 billion ($2.5 billion) funding package to construct nearly 200 kilometers (124 miles) of new subsea and underground cables connecting Scotland to the northeast of England.
The Eastern Green Link 1 (EGL1) project aims to reduce Britain’s dependence on volatile international gas markets by further utilizing North Sea wind power, playing a critical role in achieving Britain’s 2030 clean power goals. The EGL1 is expected to provide electricity to more than two million homes across Britain. Ofgem stated that the project could help consumers save over £870 million in annual bills by eliminating the need to compensate British wind generators due to inadequate grid capacity.
The project, which is nearing the end of its development phase, is being undertaken by a consortium comprising Iberdrola’s ScottishPower Energy Networks and National Grid Electricity Transmission. Construction is set to commence in 2025, with the new connection anticipated to be operational by 2029.
Ofgem has implemented a fast-track process to provide developers with initial upfront funding from the allocated budget, ensuring they can secure supply chain commitments. “However, streamlining our process does not mean we’ve handed a blank cheque to the developers. We’ve built in safeguards,” Ofgem Director of Major Projects Beatrice Filkin said in a statement.
Out of the 196 kilometers of cables, the majority will be laid under the North Sea, with the remaining 20 kilometers installed underground to connect the cables to substations and converter stations in Scotland and England. Last year, Iberdrola awarded the first contracts worth £1.8 billion to Prysmian Group, the world’s largest cable maker, for the supply of almost 400 kilometers of power cables. GE Vernova and MYTILINEOS Energy & Metals were contracted to provide two high-voltage direct current substations, one at each end of the cable.
