It was supposed to be the dream of cheap, green Norwegian energy for Scotland. The long-running NorthConnect interconnector had been in development since 2013 by a consortium of Scandinavian energy companies. However, the project was formally rejected by the Norwegian Government earlier this year. What went wrong?
What was NorthConnect?
NorthConnect was a £1.75Bn scheme to construct a high-capacity electricity cable between Peterhead, Scotland and Samnanger, Norway. The 400-mile long HVDC (high voltage direct current) submarine cable was to carry 1400MW of electricity – equivalent to a quarter of Scotland’s peak demand. The project was led by Norway’s Lyse, E-CO, Agder Energi and Sweden's Vattenfall. If built, the ‘electrical superhighway’ would have been Scotland’s first grid connection to mainland Europe.
Why are interconnectors built?
Industry experts and policymakers consider interconnectors to be a vital component of a renewables-centric electricity grid. The ability to transfer power long distances helps to overcome the inherent unreliability of renewables. It also brings with it flexibility and efficiency bonuses. The UK Government is aiming to more than double interconnector capacity from 8.4GW to greater than 18GW by 2030 (On average, the UK grid consumes around 30GW). Last year marked a new record for British interconnector exports to mainland Europe amid the energy shock stemming from the war in Ukraine.
What was the business case?
The two-way cable would have generated revenue by taking advantage of the difference in energy prices between markets over a given day. It was expected that the main energy sources would have been Norwegian hydroelectricity and Scottish wind power.
What happened?
It was full steam ahead from 2016 when the project secured an interconnector license from Ofgem and €10m of targeted EU funding. All Scottish permits and consents were in place by 2019 with a view for final investment decision the following year. At a conference in Oslo, Nicola Sturgeon stated that “the Scottish Government is a strong supporter of NorthConnect” after a meeting with the joint venture’s directors. Analysis from Norway’s state energy agency NVE said NorthConnect contributed positively to socio-economic indicators and represented great value for money.
The plans were submitted to the Norwegian authorities and then, silence. For the next three years, the Norwegian government declined to make a decision until formally rejecting the application in March.
Why did Norway reject NorthConnect?
The justification for cancelling NorthConnect revolved around concerns about energy security and the impact on energy prices. One fear was that the connection would drive up domestic energy costs as companies exported to the lucrative UK market. Another is that as electricity grids become more connected, they also become more liable to systemwide shocks.
Norway has indicated that they will reject all further interconnectors with Minister Ola Barten Moe stating his preference for “Norwegian energy to build Norwegian industry and contribute to competitive prices”. THis runs contrary to EU plans for a transcontinental ‘Supergrid’ integrating Norway’s vast hydroelectric capacity as ‘Europe’s battery’.
Where does this leave us?
While the consortium continues to lobby for the project, after 10 years it seems to have reached the end. NorthConnect represents the tension between the international common good and national self-interest that is emblematic of the climate crisis.
The cancellation is bad news for Scotland’s electricity sector and climate change commitments. Despite government ambitions to turn Scotland into a renewable-exporting powerhouse, an inability to get power where it needs to go means that the sight of shut-down wind turbines is all too common.
Transitioning to a renewables-centered grid without the flexibility of upgraded transmission infrastructure is a concerning prospect – limiting the business case for renewables and introducing the spectre of grid instability and electricity price shocks as experienced last winter.
Finlay Scott works in the offshore wind sector
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