Offshore transmission owner explained

Offshore Transmission Owners (OFTOs) operate and maintain offshore electric power transmission infrastructure in Great Britain, delivering electrical power from offshore wind farms to the National Grid. OFTOs may design and build this transmission infrastructure, but in most cases wind farm developers construct the electrical transmission assets and then sell them to an OFTO once complete.[1] [2] [3] [4]

Operation

In the British electricity market, different functions of the electricity system are separated, with this practice beginning in the 1980s. The activities of generators, transmission operators, system operators, distribution operators and suppliers are separately licensed by Ofgem, with a single business unable to perform multiple functions due to UK Competition Law.[5]

The groundwork for the offshore transmission regime was laid by the Energy Act 2004, with the first offshore transmission license being awarded in 2011., all the offshore transmission infrastructure in Great Britain has been built by wind farm developers, who are then required to sell their transmission assets to a separately licensed Offshore Transmission Owner. The divestment must take place before the Generator Commissioning Clause date, on which the exemption from this requirement lapses.

Divestment is managed via a regulated tender process administered by the energy regulator Ofgem. Qualifying bidders are required to conduct due diligence before submitting a bid to purchase the assets for transfer value determined by Ofgem and receive their bid Tender Revenue Stream (TRS) for a fixed license period. Ofgem then appoints a Preferred Bidder who negotiates the purchase terms with the Developer, after which Ofgem awards a transmission license and the transfer takes place.

Offshore transmission operators

Windfarm Developer Capacity (MW) Final Transfer Value (£m) OFTOLicense Award Date
Tender Round 1
E.ON18065.5Transmission Capital Partners2 March 2011
Ørsted17349.5Transmission Capital Partners19 July 2011
Ørsted and Centrica9033.6Transmission Capital Partners27 September 2011
Walney 1 Ørsted, SSE and OPW184105.4Blue Transmission21 October 2011
Vattenfall150103.9Transmission Capital Partners10 July 2012
Walney 2 Ørsted, SSE and OPW184109.8Blue Transmission26 September 2012
Scira315193.1Blue Transmission27 June 2013
SSE and RWE504317.1Equitix Group26 November 2013
Vattenfall300164.8Balfour Beatty17 December 2014
Tender Round 2
Ørsted, E.on and Masdar630444Blue Transmission10 September 2013
Ørsted, Centrica, and Siemens270307.7 Transmission Capital Partners4 November 2014  
RWE, Stadewerke München and Siemens 574351.9Balfour Beatty11 February 2015
Ørsted and Scottish Power Renewables388268.9West of Duddon Sands Transmission Plc19 August 2015.
Tender Round 3
Ørsted, Marubeni and GIB205172.3Transmission Capital Partners3 February 2016
E.ON219173.3 Balfour BeattySeptember 2016
Tender Round 4
Ørsted 258193.9Diamond Transmission Partners25 April 2018
Tender Round 5
Statoil402297.9Transmission Capital Partners5 November 2018  
Ørsted 573472.5Diamond Transmission Partners9 October 2019
Galloper RWE340281.8Diamond Transmission Partners24 February 2020
Walney Extension Ørsted 600446.6 Diamond Transmission Partners1 June 2020
E.ON400279.5 Transmission Capital Partners & International Public Partnerships Limited 12 November 2021
Tender Round 6
Ørsted 12181170Diamond Transmission Partners1 March 2021
SSE, Red Rock Power Ltd, The Renewables Infrastructure Group and Equitix 588437.9Transmission Capital Partners27 July 2021
ScottishPower Renewables and Vattenfall 714692.6 Transmission Capital Partners 15 December 2022
Tender Round 7 (in progress)
Diamond Green Limited, Moray Offshore Renewable Power Limited, Delphis Holdings Limited, China Three Gorges Limited 900 666.1Transmission Capital Partners15th February 2024
RWE Renewables, J-Power, Kansai 857 572.7 ETEPCO
Tender Round 8 (in progress)
Ørsted 1,368 1141.2Diamond Transmission Partners
Tender Round 9 (in progress)
Seagreen Phase 1 Seagreen Wind Energy Limited 1,140 ETEPCO (preferred bidder)
Tender Round 10 (in progress)
Moray West Moray Offshore Windfarm (West) Limited 882
Neart na Gaoithe Offshore Wind Limited 448
DBA Projco 1,200 ETEPCO (preferred bidder)
Tender Round 11 (in progress)
Dogger Bank BDBB Projco1,200

[6]

External links

Notes and References

  1. Web site: Offshore transmission. ofgem.gov.uk.
  2. Web site: Practical Law UK Signon. uk.practicallaw.thomsonreuters.com.
  3. https://books.google.com/books?id=rI9HCgAAQBAJ&dq=%22Offshore+transmission+owner%22+-wikipedia&pg=PA252 Essential EU Climate Law
  4. https://books.google.com/books?id=hvM-DwAAQBAJ&dq=%22Offshore+transmission+owner%22+-wikipedia&pg=PA163 Economics of Offshore Wind Power: Challenges and Policy Considerations
  5. Web site: 2020-11-11. The OFTO Regime: A Retrospective. 2021-07-30. WFW. en-GB.
  6. Web site: Offshore Electricity Transmission (OFTO) - Offshore transmission tenders and projects.