NSN Development Falls Under UK’s New Regulatory Framework
The planned interconnector between Norway and the UK will fall under UK’s new regulatory framework for electricity interconnectors. This follows from the criteria the British authorities submitted for consultation 23 May.
The UK regulator Ofgem announced 23 May the framework conditions for revenue regulation for international interconnectors. This is an important clarification for the realisation of the NSN interconnector project, a 1400 MW power cable that will run between Norway and the UK. At more than 700 km, it will be the world’s longest subsea cable of this type.
“We are pleased that our project will most likely be among the projects that will fall under this regulation. This gives us an even better foundation for preparing to realise this project,” says Executive Vice President Håkon Borgen in Statnett.
The proposed regulatory framework will secure minimum revenues to the developer while also providing for returning income in excess of a certain level to the consumers. This only affects the British part of the cable, and it is an important factor in ensuring acceptable project risk for Statnett’s British partner, National Grid.
NSN will be developed and owned 50% by Statnett and 50% by the British energy company National Grid. Statnett’s investment cost will be NOK 6-8 billion. The subsea interconnector will have a capacity of 1400 MW, and run between Kvilldal in Rogaland County and Blyth in the UK. The plan calls for an investment decision in 2014, and for the interconnector to come online in 2020.