The offshore transmission asset connects the Dudgeon offshore wind farm to the national grid and is a key component in supporting the UK transition towards a low carbon economy. Dudgeon represents the seventh Offshore Transmission Owner (OFTO) Licence 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 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 Dudgeon ofto
In 2018, the Company successfully reached financial close for the long-term operation of the transmission link to the 402MW Dudgeon offshore wind farm. Located 32km off the coast of Cromer in North Norfolk. Dudgeon OFTO provides the Dudgeon Wind Farm access to transmit clean power to more than 410,000 U.K. homes by transmitting electricity generated by 67 6MW offshore wind turbines5.
Since the time of the Company’s first investment, the Company has become a market leader with a combined total of over 50 years of operational performance and a portfolio with the capacity to transmit nearly 1.5GW of renewable electricity – equivalent to the electricity needs of an estimated 1.3 million U.K. homes3.
Facts
Project capital cost
£318.7m
Energy generation capacity supported
402mw
Homes Powered
410,000
SDGs Supported
The Outcome
Project highlights 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)
- 402MW renewable energy connected to the grid
- Transmission of enough renewable energy to power 410,000 homes4
[1] https://www.ofgem.gov.uk/electricity/transmission-networks/offshore-transmission
[2] https://www.renewableuk.com/news/431383/New-wind-generation-peak-rounds-off-record-breaking-year-for-renewables.htm
[3] Data provided directly from wind farm owners. Figure may vary depending on actual wind generated and transmitted, which is naturally variable.
[4] http://dudgeonoffshorewind.co.uk/