Ofgem has given SSE approval to construct a 600MW HVDC interconnector between mainland Scotland and the Shetland Isles by Q1 2024.
The decision will also enable SSE Renewables to move forwards with construction of the 443MW Viking wind farm on Shetland's main island.
The regulator’s approval for the interconnector is now subject to Ofgem being satisfied by the end of the year that construction of the Viking wind farm will go ahead.
SSE last month took a positive final investment decision on the 103-turbine Viking wind farm, a condition for approval of the link that had previously been laid out in Ofgem’s Minded To decision on the subsea transmission link.
Ofgem said it would need evidence that the final investment decision has taken place that is likely to include board minutes, project information used to inform that decision, and evidence the FID has triggered “a major development milestone, which indicates project commencement” such as entry into a major supply contract or commitment of significant spend.
A spokesperson for SSE Renewables said it welcomed the decision, adding: "SSE Renewables’ Viking wind farm is the anchor project commercially underpinning the transmission connection, which will play a critical role in Shetland’s security of supply needs as well as giving scope for future renewable development."
The company said construction "is planned to scale up in the coming weeks" and that it was engaging with Ofgem to provide satisfactory evidence the wind farm would go ahead.
Ofgem said it would publish a full decision by the end of the month but that it was publishing the decision now as it was in the interest of consumers to ensure “timely and efficient progress” of works needed to deliver the link and wind farm.
It added that most consultation responses did not agree with approval of the link, citing perceived negative impacts of the link and wind farm on the local area and the alternative option of a new gas plant for the island.
The wind farm is still waiting for approval from the Scottish Land Court, which arbitrates disputes over crofting land, after local objections were received.
SSE said when complete the wind farm will be the UK’s largest onshore wind farm in terms of annual electricity output, harnessing the island's "excellent wind conditions to produce enough energy to power almost half a million homes."
It added that construction would support the island's, Scottish and wider UK supply chains, creating 400 jobs at peak construction and a further 35 full-time operations and maintenance jobs throughout its life.
