Scottish and Southern Electricity Networks (SSEN) Transmission, energy company SSE’s transmission business, is planning a £22.3 billion grid infrastructure investment.
SSEN Transmission submitted its business plan for the RIIO-T3 price control period, from 2026 to 2031, to Ofgem yesterday (10 December). Its plans are underpinned by three goals: reliable energy, clean power and SSE’s legacy.
SSEN Transmission is a 75%-owned subsidiary of SSE plc. The plan sets an evidence-based need for a potential known total expenditure of about £22.3 billion, including a baseline total expenditure of £6 billion.
It further includes around £16 billion committed strategic investments that have already received approval of need from Ofgem through its Accelerated Strategic Transmission Investment (ASTI) framework and London Office of Technology and Innovation (LOTI) Uncertainty Mechanisms.
The business set out potential for an additional £9.4 billion of future expenditure that could raise the total spend over the RIIO-T3 period to £31.7 billion.
Ofgem’s RIIO-3 framework (RIIO-T3 relating specifically to transmission programmes) offers network companies incentives for innovation and securing investment so that they can develop sustainable energy networks at the lowest cost for current and future customers.
According to SSE, significant investments are critical to enabling the UK and Scottish government climate change and energy security targets and represents one of the largest ever private investment programmes in Scotland.
Alistair Phillips Davies, chief executive of SSE, said the RIIO-3 price control period comes at a “critical juncture in the effort to deliver a cleaner, more secure and affordable electricity system”.
He added: “It is now crucial that Ofgem backs that ambition with an investable and financeable framework, setting an appropriate cost of equity that recognises the unprecedented levels of investment required to decarbonise the economy and deliver a clean power system.”
Independent, peer-reviewed, economic analysis by BiGGAR Economics forecasts that the investment by SSEN Transmission could support up to 37,000 jobs across the UK, 17,500 of which would be in Scotland, with 8,400 in SSEN Transmission’s operating area in the north of Scotland.
Critique of the UK’s climate policy often centres around the potential job losses associated with closing down the oil and gas industry in the North Sea and the area is a focal point in the push to establish a green workforce.
After the UK and Scottish governments pledged to work together to ensure an industrial future for the site of oil and gas company Petroineos’ oil refinery in Grangemouth, ScottishPower pointed out the clear skills crossover and added it could help workers find new positions in its energy networks business.
SSEN Transmission also said its investment will support the development of at least 1,000 new homes across the north of Scotland. This meets another of the government’s core goals which is to build 1.5 million new homes over the next five years.
Rob McDonald, managing director of SSEN Transmission, said: “In what is one of the largest investment programmes of all time in Scotland, this plan will also support tens of thousands of jobs across the country, turbo-charging the economy and delivering a transformational and lasting legacy for communities, the economy and nature.
“We now look forward to working constructively with Ofgem, Government and wider stakeholders to ensure the future regulatory framework secures the investment required to support the nation’s ambitious goals and delivers the vast economic opportunities the clean transition presents.”
