SSE : FINAL INVESTMENT DECISION FOR VIKING ONSHORE WIND FARM

SSE has approved a final investment decision for the 103-turbine, 443MW Viking onshore wind farm, in a step which will help to drive forward a green economic recoveryafter the coronavirus lockdown. Located in Shetland, Viking is wholly owned by SSE Renewables having been developed in partnership with Viking Energy Shetland.

Viking will harness the excellent wind conditions in Shetland which result inan estimated load factor of around 48%. Once built it will be the largest onshore wind farm in the UK in terms of annual electricity output,which is expected to be around 1.9TWheach year, therefore playing a vital role in contributing towards the UK and Scotland's net-zero targets.

SSE now awaits the outcome of theconsultation on Ofgem'sminded-to position to approve a 600MW transmission connection from Shetland to the GB mainland, expected in July2020. Final approvalfrom Ofgem wasconditional on Viking wind farm reaching a positive final investment decisionwhich this announcementconfirms. The transmission connection is critical for Viking to proceed.

SSE's decision is conditional on the outcome of several industry code modifications which are currently in progress.These include the code changes whichfacilitate the contribution from the Distribution Network Operator, SHEPD,to the cost of the transmission link. Ofgem is expected to publish a decision on these ahead ofthe decision on the Needs Case.

SSE's capital expenditureon the wind farmis estimated to be around £580m,and this forms part of updated capital expenditure planswhich are set out as part of SSE's preliminary results on 17June. Construction on the enabling works for the transmission link has started, with works on the wind farm starting late summer.

Viking is the anchor project that commercially underpins the transmission link,which will play a critical role in Shetland's security of supply needs. Both the wind farm and the link willbring vital socio-economic benefits to the islands, opening up much needed and sustainable diversification of the Shetland economy.

Managing Director of SSE Renewables, Jim Smith, said: 'Viking wind farm will help kickstart thegreen economic recovery, bringing much neededlow-carboninvestment to Shetland. In doing so, it willtrigger the building of theassociatedtransmission connection to the islands,which will itself help resolvelongstanding securityofsupplyissues on the island'.

Scottish Government Energy Minister, Paul Wheelhouse, said: 'This is excellent news for Shetland, and for Scotland's renewable energy and climate change ambitions. The Viking wind farm project is also a great symbol for the green recovery that the Scottish Government is determined to foster and encourage, as we move through and beyond the current Coronavirus pandemic.

'This decision is of sufficient scale to act as the trigger to unlock the much anticipated major investment in a high voltage connection from Shetland to mainland Scotland, subject to a final decision by Ofgem which we expect shortly. It is essential that the community of Shetland benefits from this project and we look forward to further news of contracts being awarded to local businesses, as well as Scotland as a whole, during the construction phase.

'I am determined that this excellent outcome should be a starting point for similar investments and connections to unlock equivalent potential and benefits on the Western Isles and in Orkney.'