The offshore transmission asset connects the offshore wind farm at Gunfleet Sands to the national grid.
THE BACKGROUND
Offshore wind generation is a success story for the UK. Long-term government support has underpinned innovation and investment in the sector, helping to drive down costs while contributing to decarbonisation of the economy. The Government intends to build on the UK’s leading position with an aim to produce 40GW of offshore wind energy by 2030, up from c. 10GW in 2020. The UK has provided more support for offshore wind than any other country in the world and we anticipate that the technology will play a key role in helping the UK meet net zero by 2050.
To support this increase in offshore renewable energy generation, the Government identified that a new approach to developing transmission networks would be required and developed the offshore transmission regulatory regime. The Company recognised this opportunity and strategically positioned itself as one of the very few original consulting parties to Ofgem on the regime in 2009.
About Gunfleet Sands OFTO
This was the second Offshore Transmission Owner (OFTO) Licence to be awarded to INPP under the competitive tender process managed by energy regulator Ofgem, for the licensing of high voltage transmission links with offshore wind farms in Great Britain.
The project relates to the connection of the Gunfleet Sands offshore wind farm, located 7km off the coast of Clacton-on-Sea, Essex. The transmission assets comprise the onshore and offshore substations and under-sea cables connecting the 173MW capacity offshore wind farm with the onshore grid network.
The OFTO Licence is held by an INPP company, which has acquired the link from the wind farm owner Gunfleet Sands Limited.
Facts
Project capital cost
£60.4m
Energy generation capacity supported
173MW
Homes powered by renewable energy
150,000
SDGs supported
THE OUTCOME
Highlights of the project include:
- Operational and immediately yielding with no construction or refinancing risk
- 20-year availability-based revenue stream with protected downside whereby potential deductions will be capped at 10% of base revenue in any year
- Returns generated are fully linked to UK RPI and are not subject to any revenue or penalty exposure to windfarm performance or credit
- Revenues are contracted by a subsidiary of National Grid, NGESO, in their statutory ring-fenced role as the National Electricity Transmission Systems Operator and protected by the Energy Administration rules (Energy Act 2004)