SSEN Transmission signs £1bn Bank Facility backed by the National Wealth Fund

SSEN Transmission, 75% owned by the electricity infrastructure company SSE plc, today announces a £1bn, 12-year bank facility backed by an £800m financial guarantee from the UK Government’s National Wealth Fund which will support four major grid upgrade projects under way in the north of Scotland.

This new bank facility has been syndicated to a group of SSEN Transmission’s relationship banks, led by Bank of America, and including BBVA, HSBC, JP Morgan, Lloyds, MUFG, NatWest and Santander.

The financing announced today is ringfenced as a Green Loan to support four SSEN Transmission projects which will upgrade grid capacity, improve local resilience and connect power from the places of generation to areas of demand throughout the GB grid. The projects are SSEN Transmission’s Skye Reinforcement, Argyll and Kintyre 275kV Strategy, and the Orkney Connection as well as the jointly developed venture Eastern Green Link 2 (‘EGL2’). 

These projects will see Orkney connected to the transmission grid for the first time, as well as significantly strengthening the transmission infrastructure serving communities including Skye, Fort Augustus, Argyll and Kintyre.

EGL2 HVDC subsea project is the largest ever single investment in the UK transmission system and will play a critical role in delivering the UK and Scottish governments’ clean power and energy security targets – supporting thousands of jobs across the country and boosting local and national economies.

The National Wealth Fund’s supported financing offers longer-dated lending, better aligning with the life of grid assets and ensuring the swift progression of these four critical upgrade projects, which have been independently assessed as required by both the independent National Energy System Operator (NESO) and the energy regulator, Ofgem.

Chancellor of the Exchequer, Rachel Reeves, said:

“We are investing in grid upgrades and homegrown, clean energy to get us off the global energy price rollercoaster, creating thousands of new, skilled jobs in the process, and boosting growth. This builds on our action at the Budget to take an average £150 off energy bills.

“This backing from the National Wealth Fund will help deliver the infrastructure upgrades needed to capitalise on Scotland’s renewable energy production and help strengthen the energy security of the whole UK.”

Energy Secretary, Ed Miliband said:

"We are supporting 3400 good jobs for Scotland, reversing years of underinvestment in our energy grid to connect more clean homegrown power to get bills down.

“Our clean power mission is about growth, jobs and energy security – and this £800 million guarantee from the National Wealth Fund for Scotland’s electricity grid delivers on all three.”

Scottish Secretary, Douglas Alexander said: 

"This £800 million guarantee is a major vote of confidence in Scotland's leading role in delivering Britain's energy transition.

It shows the strength of the U.K.’s support for Scotland as this National Wealth fund guarantee will support up to 3,400 jobs, strengthen our energy security, help reduce bills, and ensure the renewable power generated in Scottish communities can reach homes and businesses across the country." 

Barry O’Regan, SSE’s Chief Financial Officer, said:

“This new Bank Facility supported by the National Wealth Fund financial guarantee provides an excellent source of funding diversification, and with a three-year availability window helping to manage liquidity for SSEN Transmission. It demonstrates the importance of grid upgrades both in achieving the country’s clean power and energy security goals, and in unlocking economic growth throughout the nations and regions of Britain.”