Fid Financial Close

On 13 August 2024, Ofgem issued its final Project Assessment (PA) decision under the Accelerated Strategic Transmission Investment (ASTI) framework, awarding Eastern Green Link 2 a £3.4 billion funding package and making EGL2 the first of 26 fast-tracked transmission projects to complete the ASTI funding-approval process. For a regulated transmission investment like EGL2, the Ofgem PA decision is the moment the project's funding is firmly committed — combining what a merchant interconnector would call financial close with the regulated cost-recovery approval (TNUoS allowance) that lets the joint venture between SSEN Transmission and National Grid Electricity Transmission start construction. Ofgem's scrutiny of the developers' proposal cut over £79 million from the project costs without impacting delivery or quality. The £3.4 billion allowance covers the c.436 km HVDC subsea cable under the North Sea, around 70 km of buried onshore cable, and two 525 kV bipole converter stations at Peterhead (Aberdeenshire) and the Drax area (North Yorkshire). With the PA decision in place, Ofgem confirmed that work was expected to begin later in 2024 with the new connection due to be operational by 2029, and signalled a follow-up statutory consultation to formalise the modifications to the Transmission Operator licence conditions implementing the decision.