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Further delay for subsea cable report       8/5/13

A study which could make-or-break the prospects of a subsea cable needed to export the output of island windfarms has been held up for another day.

The long-awaited report was to be published today but last minute hitches means it will not be made public until Friday.

The study is a collaboration between the UK and Scottish governments which examined the transmission system which charges about 50 or 60 times more to export renewable electricity from the islands compare to a generator in the south of England.

The multi-agency group included Highlands and Islands Development and the islands’ councils in an attempt to identify and assess options for addressing or mitigating the impact of the charges faced by renewable energy generators in the Scottish islands.

Its remit was to assess the commercial viability of renewable projects on the Scottish islands and the overall value for money these projects provide for the UK.

The islands’ vision of a booming economy and jobs created from the energy sector will crash unless the contract for the underwater interconnector is approved virtually immediately.

Major Western Isles renewable energy schemes are delayed as Scottish and Southern Energy (SSE) - the monopoly national grid operator for the region - reckons excess transmission charges will deter developers from investing in planned energy schemes. SSE fears they will pull out of paying for the sub-sea cable.  

The final report highlights that the islands have a massive energy potential and are ideally situated to generate vast amounts of electricity.

It points out that the high charges of exporting the output from proposed windfarms is major challenge.

So is getting grid connections and securing a subsea cable off Lewis.

Transmission charges increase the further distant the generator is from user so it effectively penalises energy developments in the Hebrides.

The report comes towards a crucial stop-or-go deadline for a £700 million sub-sea cable to export the output of Western Isles energy developments to southern mainland markets.

It is likely to spearhead the possibility of increasing the level of Renewables Obligations Certificates (ROCS) subsidy for island-based renewables projects to bring charges in line with mainland schemes.

SSE said it was waiting for the study, which would outline the government’s proposals to tackle the export charges, before proceeding with the end process to secure the cable.

A SSE spokesperson said that since “we had not received a clear policy statement from Ministers by the end of April, it was unlikely that we would be in a position to place the cable contract on 1 July.”

The July date is important as it is the last opportunity of a confident timescale to manufacture and install the submarine cable.  Each passing day risks a further three year wait.