National Grid, Scottish Power fined $211 million for subsea cable delay

© Reuters. FILE PHOTO: Migrating starlings fly at dusk past electricity pylons silhouetted by the sunset of a clear autumn evening in the Kent countryside, in Graveney, Britain, October 26, 2015. REUTERS/Dylan Martinez

By Muhammed Husain

(Reuters) -National Grid and Scottish Power have been fined 158 million pounds ($211 million) by Britain's energy regulator for a two-year delay to the Western Link transporting electricity from Scotland to Wales and England.

Ofgem said on Tuesday the companies had acknowledged that the 1.3 billion pound subsea cable was delivered late.

"The joint venture recognises it is ultimately accountable for the delay and has therefore agreed to the redress package," said a spokesperson for the Western Link JV between National Grid (LON:NG) Electricity Transmission and Scottish Power Transmission.

NGET is owned by Britain's National Grid, while Scottish Power is owned by Spain's Iberdrola (MC:IBE).

Ofgem said its investigation, which began in January 2020, found the delay was due to problems with land acquisition, manufacturing, installing the cables and commissioning tests.

It added that delay in construction of the power cable increased costs for consumers as difficulty in transporting energy from Scotland to England and Wales often forced National Grid to reduce output from windfarm generators.

Ofgem said 15 million pounds of the fine will be paid into its redress fund, while the rest will be passed on to customers via reduced charges.

The link, which provides 2,250 megawatt of electricity, had fallen behind its expected delivery date of March 2017 to June 2019. It was designed to transport electricity, often from green sources like offshore wind, from Scotland to Wales.

Ofgem said the delay in the project made it difficult at times for renewable energy generators in Scotland to export clean electricity to England and Wales.

($1 = 0.7484 pounds)