DTI

13 February 2002

WILSON ANNOUNCES NEW UK - SCOTLAND LINK STUDY -
WE NEED TO ENSURE RENEWABLE ENERGY BENEFITS ARE FULLY EXPLOITED.

Energy Minister Brian Wilson announced a comprehensive study on
options for strengthening of the transmission system between Scotland
and the rest of the UK when he addressed the Scottish Grand Committee
at Westminster.

Mr Wilson said that without enhancement of transmission capacity,
there was no chance of Scotland realising its potential in renewable
energy. Also, he said, under proposed new arrangements to create a
UK-wide market in electricity, "it is absolutely clear that if the
benefits are to maximized for Scotland, then the capacity to sell
into the UK market has to be increased."

Mr Wilson added:

"Our capacity to be exporters of power is constrained by the
inadequacy of the existing infrastructure. I recognised this issue
when I commissioned a feasibility study into the concept of a subsea
interconnector along the western seaboard of the United Kingdom.

"That report, which I am publishing today, points in the direction of
considering land based options for strengthening the transmission
capacity from north to south. Indeed, it may well be that the optimum
solution lies in some hybrid of the two - sub-sea cable and
land-based strengthening."

Mr Wilson said of the PB Power report on the sub-sea cable option:
"It is an excellent piece of work which greatly assist in informing
the debate. It sustains the validity of the concept while being
realistic about the costs and difficulties."

"We will undertake the new study in partnership with the Scottish
companies, the Scottish Executive, NGC and the regulator. I will
expect both conclusions and firm recommendations on the way forward
to be available within six months. It will be a clear expectation of
Government that the final proposals will extend to the North and West
of Scotland, including the islands".

Mr Wilson told the committee that with his full support and that of
the Scottish executive, the regulatory body Ofgem has initiated a
consultation on the creation of a GB - wide electricity market. He
said is absolutely clear that if the benefits of these proposed new
arrangements are to be maximised for Scotland, then the capacity to
sell into the UK market has to be increased.

Mr Wilson also told the Scottish Grand committee that he was laying
the draft Renewables Obligation Order before Parliament today.

"The Renewables Obligation offers a fantastic opportunity to develop
a thriving industry, building on traditional Scottish expertise in
offshore technologies and engineering know-how".

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