Ofgem appoints preferred bidder for Westermost Rough offshore transmission assets
Press release
Publication date
Industry sector
Offshore Transmission Network
Official Public Notice
Today Ofgem has appointed Transmission Capital Partners as the preferred bidder to own and operate the offshore transmission link to the Westermost Rough windfarm for the next 20 years.
Transmission Capital Partners, a consortium comprising Transmission Capital Partners Limited Partnership and International Public Partnerships Limited, was selected by Ofgem through a competitive process in which bidders compete to become offshore transmission owners (OFTOs). This tender exercise saw the lowest revenue bids, as a proportion of asset value, seen to date.
The Westermost Rough offshore wind farm, located in the North Sea approximately eight kilometres off the coast of Yorkshire, comprises 35 wind turbines and has a total installed capacity of 210MW. The estimated value of the transmission assets is £172.3m. The transmission assets for this project are currently owned and being constructed by Westermost Rough Ltd, a joint venture between DONG Energy (with 50 per cent ownership), Marubeni Corporation (with 25 per cent) and the UK Green Investment Bank (with 25 per cent).
The Westermost Rough transmission assets are being tendered under Tender Round 3. Since the offshore transmission regime was set up by Ofgem and the Department of Energy and Climate Change (DECC) in 2009, it has delivered £2.3 billion of investment and led to significant savings for consumers. In addition to this, over £600 million of transmission assets are currently in the process towards licence grant, with billions more in the pipeline for future tender rounds.
Notes to editors
1. The reserve bidder for the project is Blue Transmission, a consortium of 3i Investments plc and Mitsubishi Corporation.
2. There are two projects in Tender Round 3, as detailed below:
3. The offshore regulatory regime was developed by DECC and Ofgem and was launched in 2009. The regime is for licensing offshore electricity transmission and uses competitive tendering to ensure lower costs and higher standards of transmission services for generators and, ultimately, consumers.
The regime is flexible, allowing Ofgem to run tenders for projects where:
- Offshore Transmission Owners (OFTOs) design, build, operate and maintain the transmission assets; or
- Generators build the transmission assets and then transfer them to OFTOs at construction completion.
4. Further information concerning the estimated cost savings realised from applying the OFTO regime to Tender Round 1 can be found in a report commissioned from BDO/CEPA.
5. Ofgem currently expects the next tender round, Tender Round 4, to launch in 2016.
6. See the Official Public Notice for the appointment of Transmission Capital Partners as the preferred bidder to own and operate the link to the Westermost Rough windfarm.
7. Ofgem is the Office of the Gas and Electricity Markets, which supports the Gas and Electricity Markets Authority, the regulator of the gas and electricity industries in Great Britain. The Authority's functions are set out mainly in the Gas Act 1986, the Electricity Act 1989, the Competition Act 1998 and the Utilities Act 2000. In this note, the functions of the Authority under all the relevant Acts are, for simplicity, described as the functions of Ofgem.
For further press information contact:
Chris Lock: 020 7901 7225
Kate Wilcox: 020 7901 7113
Out of hours media contact number: 07766 511470