National Grid backs £850m plan for Denmark cable link
NATIONAL Grid has given the green light to an £850m plan to build the world’s longest high-voltage power cable between the UK and Denmark.
The energy giant’s long-awaited investment decision means the 460-mile Viking Link project will begin importing Danish electricity from 2023, rather than 2022 as originally planned.
National Grid boss John Pettigrew said the project will help keep the company on track to grow the value of its portfolio of pipes and wires by between 5pc and 7pc over the medium term.
It will be capable of powering over a million homes and is expected to earn National Grid £100m before interest, tax, debt and amortisation. The decision emerged as National Grid revealed its profits for the first half of this year fell by 6pc to £1.3bn after it was stung by US tax reforms and costs of repairing storm-hit assets.
National Grid’s US problems include a spate of industrial disputes over fresh worker contracts, which has led to a £97m lockout of 1,200 gas workers in the US state of Massachusetts. Around 16 union branches have accepted its health and pension benefit changes but two branches are resisting the terms at a cost of £1m a day to National Grid.
National Grid will be able to pay its share of the Viking Link project, which it is developing alongside Danish transmission company Energinet, in part using the funds from the sale of its stake in the Cadent gas network business. Its shares edged up 1.5p to 840p yesterday.
Energy supplier SSE and Innogy are discussing changes to the terms of a planned tie-up of their retail units in Britain after Ofgem proposed a price cap on energy tariffs. SSE, whose deal with Innogy would create the UK’s second-largest retail power provider, said it was likely the deal would be delayed beyond the first quarter of 2019.
John Pettigrew, the boss of National Grid, said the decision to invest in the Danish scheme will increase infrastructure value