Bids needed by Xmas to keep lights on in Lerwick as ageing oil- and gas-fired power stations near end of lifespan


Lerwick's oil-fired power station
Lerwick’s oil-fired power station

Scottish and Southern Energy is seeking views from market participants on a future energy solution for Shetland, as it prepares to tender for services to maintain a secure electricity supply on the island network.

Electricity is currently generated from the oil-fired Lerwick Power Station – which is nearing the end of its operational life – and gas-fired Sullom Voe Terminal Power Station, which cannot confirm availability beyond May 2017.

The Shetland Islands – located about 150 miles north east of mainland Scotland – are not currently connected to the UK electricity system.  A new energy solution is therefore being sought to meet the islands’ future electricity needs.

The Perth-based UK utility giant is working with the UK energy regulator Ofgem to prepare a competitive process to seek the most economic and efficient solution from the market.

The Shetlands offer high potential for the development of renewable energy resources – wind, wave and tidal – with innovative smart grid solutions to manage their contribution to the network.  

A trial project – called Northern Isles New Energy Solutions (NINES) – is already delivering some energy storage and domestic demand side management measures.

At this stage, the structure of the future solution is open and potential bidders are being asked to feed in their initial views on this exciting opportunity.

It is anticipated that services required will include reliable capacity and energy; intermittent energy; and reduction in capacity and energy. There is also an opportunity for hybrid or smart solutions building upon the work done via the NINES project.

Stuart Hogarth, Director of Distribution at SSE, said: “We are working closely with Ofgem to deliver a process that is open to all technologies.  We hope that a wide range of market participants will engage with the current consultation and recognise the opportunity which the process ahead represents.

“Subject to the feedback we receive, we expect to seek formal expressions of interest in Spring 2015.  In the meantime, we would encourage businesses to take the opportunity to read and respond to the consultation document which has been published so their ideas and views can be considered.

“The consultation seeks feedback on a proposed delivery date for a complete new energy solution of 2019, while recognising that some bidders may want to propose earlier or later delivery dates.”

Deadline for prospective bids to SSE is by Friday 19 December 2014

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