New report to establish value of interconnector to Orkney economy post-Covid

Orkney Islands Council has commissioned a report seeking to establish what a new electricity transmission link to the mainland could mean to the local economy, as the islands seek to recover from the effects of the Covid19 pandemic.

The report will determine the Gross Value Added (GVA) - the measure of the value of goods and services produced in an area, industry or sector  - to the Orkney economy of a new electricity interconnector linking Orkney with the Scottish Mainland, over a 45 to 50 year period.
The report – which is being produced by economic advisers GHD - will seek to establish the benefits of the new cable and the renewable generation growth it can support.

Ofgem’s approval for a new cable is currently dependent on at least 135 MW of new energy generation projects in Orkney, but the proposal from SSEN is build a 220MW interconnector – meaning that ‘space’ would exist on the cable to support emerging industries like wave and tidal generation – potentially providing further additional benefit to the Orkney economy. 

The report will furthermore separately determine the added benefits of any projects under development with a high level of community ownership. Projects with a higher degree of community ownership are potentially significantly more important to the local economy, as a greater percentage of their income would stay in the county.

For example, the benefits of the proposed projects under ‘Orkney’s Community Wind Farm Project’ have the potential to contribute more to the economy than other proposed developments, as they will be wholly owned by the Council – with the income generated being used entirely for the benefit of local people.

John Mundell is Orkney Islands Council’s Interim Chief Executive.  He said: “As Orkney looks to get back on its feet economically after the devastating blow of the Covid 19 pandemic, it’s vital that we grasp every opportunity available to us, particularly opportunities that allow us to make the best use of existing resources.

“It’s a fact that Orkney is an area rich in renewable sources. Wind speeds on Orkney are high, with Orkney turbines some of the most productive in the world.  We have a well-established reputation across the world for innovation in renewables and a world-class supply chain.

“A new transmission system infrastructure is desperately needed to ensure that people in Orkney can continue to benefit from these valuable renewable resources.

“The report will arm us with the facts on the potential socio-economic benefits of the transmission link – and accordingly the benefits of the various projects that are under development - to the Orkney economy, and therefore to local people. This information will be invaluable to us as we plan for economic recovery and discuss our needs with the Scottish and UK Governments."

Around 45 MW of new projects are currently consented in Orkney, at Hesta Head, Costa Head and Hammars Hill.