Ofgem publishes regulatory arrangements for NeuConnect project
- Regulatory milestone follows start of construction announced this month
The UK’s energy regulator Ofgem has now published its provisional regulatory arrangements for the £2.4bn NeuConnect project – a vital new energy link between the UK and Germany. The regulatory details published by Ofgem are another important milestone in NeuConnect’s delivery, and follow the start of construction work on the project announced earlier this month.
Led by global investors Meridiam, Allianz Capital Partners, Kansai Electric Power and TEPCO, NeuConnect will become one of the world’s largest interconnectors. Some 725km of land and subsea cables will form an ‘invisible energy highway’ between the UK and Germany, allowing up to 1.4GW of electricity to flow in either direction, helping to boost energy security and resilience while also helping to integrate renewable energy sources in both countries.
In the UK market, NeuConnect will operate under Ofgem’s existing ‘Cap and Floor’ regulations which are designed to encourage investment in interconnectors while also protecting the interests of consumers. With the NeuConnect project reaching Financial Close in July 2022, Ofgem committed to setting out NeuConnect’s provisional cap and floor levels which have now been published.
NeuConnect CEO Arnaud Grévoz said: “The regulatory details confirmed by Ofgem are another important step for NeuConnect and build on the strong momentum across the project with construction work now underway. We are grateful for the continued support from Ofgem as we deliver this vital new energy link.”