The energy regulator Ofgem has agreed to fast-track plans by ScottishPower that will see £2.6 billion invested into power upgrades between 2013 and 2021.
The plans will see the creation of up to 1,500 new jobs in Scotland.
ScottishPower’s detailed proposals outline investment priorities up to 2021 that will enable upgrades to the electricity network in central and southern Scotland. The plans are also designed to help achieve European carbon reduction targets.
A key feature of the proposals is the connection of offshore and onshore wind generation in Scotland of around 11 GW—enough to power over six million homes.
The £2.6 billion investment will deliver over £2 billion in reduced carbon emissions (equivalent to 45 million tonnes of CO2) and increase export capacity from Scotland to England from 3.3 GW to almost 7GW by 2021, the company said.
Other benefits include reduced constraint costs to the UK consumer to the tune of £1.7 billion; renewal and replacement of over 15 per cent of the company’s existing substation assets; replacement of around 800 kilometres of overhead lines; and a modernised network.
Commenting on the announcement, Frank Mitchell, CEO of ScottishPower Energy Networks, said: “We are pleased to have reached early agreement with Ofgem and believe that this framework will allow us to confidently take forward our recruitment and investment programmes.
“This agreement will ensure the best value for consumers, whilst guaranteeing a modern and robust electricity system capable of supporting the UK’s and Scotland’s ambitious carbon reduction targets.”
He concluded: “Our engagement with Ofgem during the course of this process has been very positive and we have worked effectively together to agree these proposals. The fact that our initial submission is relatively unchanged reflects well on the detail of work that went in to our plans.”
Ofgem has agreed a 4.5 per cent rate of return on investment over the eight-year investment period.
