Ofgem has said £3.4 billion will be made available for a proposed 500-kilometre undersea power line between a site near Drax Group's (LSE:DRX) North Yorkshire power station and north-east Scotland.
Eastern Green Link 2, dubbed the UK’s biggest-ever transmission project, will provide power for up to 2 million homes from the "rich renewable energy capacity of Scotland", bringing power from Peterhead in Aberdeenshire down to the coastal site of Bridlington, with an underground connection from there to the nearby Drax biomass power station.
Most of the cable will travel under the North Sea in a bid to harness the UK’s growing offshore wind portfolio and is set to aid the faster rollout of new power generation.
“To ensure we meet future energy demand and achieve government net zero targets we must speed up the expansion of the high voltage electricity network which connects consumers to homegrown energy,” Ofgem director Rebecca Barnett said.
Costs of the new cable are set to be footed by developers but ultimately recouped through energy bills, Ofgem said.
Why is the cable needed?
Ofgem said the cable is needed as some power from wind farms goes unused as there is not enough capacity to carry it to places where it could be used.
Not only that, not only are wind turbines being turned off, but the owners of windfarms are paid to turn them off as part of a process called curtailment.
This month so far, there has been nearly £50 million paid to wind farms in compensation for being asked to shut down, according to the UK Wind Curtailment Monitor tool.