The UK energy regulator has approved early construction funding for several strategic electricity transmission projects being developed by National Grid PLC (LSE:NG.) and SSE PLC (LSE:SSE), enabling key infrastructure developments to move forward faster.
Ofgem announced the unlocking of the funding to allow developers to secure scarce materials and carry out enabling works such as land purchases and surveys ahead of planning decisions.
Projects benefiting from the decision include eight electricity transmission schemes led by Scottish Hydro Electric Transmission, 75%-owned by SSE's SSEN arm, and the Sealink transmission line proposed by National Grid Electricity Transmission, linking Suffolk and Kent.
“Today’s decision means that we’ll be able to power more homes with homegrown clean power faster,” said Beatrice Filkin, Ofgem’s director of major projects.
The decision forms part of Ofgem’s Accelerated Strategic Transmission Investment (ASTI) framework, which supports grid upgrades essential for connecting between 43 and 50GW of offshore wind by 2030.
Ofgem stressed that the ECF approvals do not constitute project approvals. “We are not handing projects blank cheques nor greenlighting the projects themselves – these are rightly decisions for the relevant planning authorities,” Filkin said.
The regulator said developers must demonstrate that spending will benefit consumers or risk not being able to recover costs.