Eight SHET Early Construction Funding applications

What this is about

Ofgem has set out its minded-to position on eight Early Construction Funding (ECF) applications from Scottish Hydro Electric Transmission (SHET, the SSEN Transmission licensee). All eight projects fall under the Accelerated Strategic Transmission Investment (ASTI) re-opener in SHET's transmission licence. ECF is the mechanism that lets a transmission owner draw down consumer-funded allowances for permitted early-construction activities, ordering long-lead items, securing manufacturing slots, mobilising contractors, before the project has planning consent and before its full costs are finalised.

The timing is driven by the build rate, not by any single trigger. The Scotland-to-England export upgrade is the spine of Clean Power 2030: a large volume of constrained Scottish wind needs new transmission capacity to reach demand, and the long pole in that tent is the manufacturing and consenting lead time on HVDC links, substations, and overhead line. Waiting for planning consent before placing supply-chain orders adds years that the 2030 target cannot absorb. ECF exists to compress that sequence by spending ahead of consent. Eight projects from a single licensee in one consultation is a material slice of the northern build programme, and the decision determines how much consumer money is committed before the projects are certain to proceed. That is the same trade-off the Advanced Procurement Mechanism poses at programme level, here decided project by project.

The substance Ofgem is balancing is explicit in the framing: enabling projects to progress at pace where that is in the consumer interest, against protecting consumers from disproportionate exposure to irrecoverable costs if a project does not proceed as planned. Every pound of ECF released before consent is a pound at risk if the project is refused, redesigned, or cancelled. The asymmetry matters. The benefit of early spend (time saved, slots secured) is diffuse and probabilistic; the cost of a stranded early-works programme is concrete and falls on consumers through transmission charges. Ofgem is explicit that ECF does not influence and should not be read as prejudging any planning outcome, and it is steering project-design and scope objections to the planning process rather than to this consultation.

Options on the table

The consultation document itself is a 452KB PDF that sets out Ofgem's project-by-project assessment; the web page does not enumerate discrete policy options or numbered consultation questions, so the structure below reflects the decision Ofgem is actually making rather than a formal options menu. The real choice is per-project and quantitative: for each of the eight SHET projects, how much early-construction expenditure to fund, and on what conditions.

Approve the minded-to ECF allowances as proposed

Ofgem confirms its project-by-project minded-to position and releases the assessed ECF allowance for each of the eight projects. SHET can commit early-works and supply-chain expenditure across the portfolio against those allowances. The winners are the Clean Power 2030 build timeline and SHET, which de-risks its delivery schedule by locking manufacturing slots and contractor mobilisation early. The cost sits with consumers, who carry the irrecoverable-cost risk on any project that does not proceed as assessed. This is the path that maximises pace.

Approve with reduced allowances or tighter conditions

Ofgem funds less than SHET requested on some or all projects, or attaches conditions, staged drawdown, milestone gates, narrower scope of permitted early activity, that limit consumer exposure. This is the calibration option: it preserves most of the timeline benefit while shrinking the stranded-cost tail on the projects where consent risk is highest or the cost case is weakest. Consumers carry less risk; SHET carries more schedule risk on the constrained projects and may have to self-fund or defer some early works. Given that Ofgem frames ECF explicitly as a balance, expect the final decision to differ between projects rather than apply one rule to all eight.

Decline ECF for one or more projects

Where the consumer interest case does not hold, project too early, consent risk too high, cost case not made, Ofgem declines ECF for that project. Those projects revert to the conventional sequence: early works wait for consent. Consumers are protected from that project's irrecoverable-cost risk; the cost is timeline, and a project that loses its early procurement window may slip past 2030. This is unlikely to apply across the whole portfolio but is a live outcome for individual projects, which is precisely why Ofgem assesses them one by one rather than as a block.

Questions being asked

The web page does not publish a numbered question set; it directs respondents to the consultation PDF and invites views on Ofgem's minded-to position. The substantive questions implied by the framing fall into three themes.

The consumer-interest case for early spend

Whether, for each project, the case that early-construction funding serves the consumer interest is made out. (This is the core test: does the time saved and schedule certainty bought by spending ahead of consent outweigh the expected stranded cost, weighted by the probability the project does not proceed as planned? Respondents with a view on specific projects' consent risk or delivery criticality should engage here.)

Proportionality of consumer exposure to irrecoverable cost

Whether the proposed ECF allowances and any conditions strike the right balance between pace and protecting consumers from disproportionate exposure if a project does not proceed. (This is where to argue for staged drawdown, milestone gating, or reduced allowances on higher-risk projects rather than the full requested amount.)

Scope and competition in onshore transmission

Views from stakeholders with an interest in transmission infrastructure costs and in competition in onshore transmission networks. (Note: Ofgem has explicitly ring-fenced project design and scope objections to the planning process, not this consultation. Responses on the design or routing of specific projects will be redirected. The competition angle, how early funding of an incumbent's portfolio interacts with the prospect of competitively tendered onshore transmission, is in scope here and is the more productive line for stakeholders with that interest.)

How to respond

Deadline: 10 April 2026. The consultation opened on 5 March 2026.

How to respond: Send responses by email to Transmission.Acceleration@ofgem.gov.uk.

Consultation document: "Eight SHET Early Construction Funding applications" (PDF, 452.92KB), available from the Ofgem consultation page. The PDF contains the project-by-project assessment and is the document to read before responding; the web summary does not carry the per-project figures.

Who Ofgem wants to hear from: People with an interest in new transmission infrastructure, meeting net zero, and competition in onshore transmission networks. Ofgem particularly welcomes responses from consumer groups, stakeholders directly impacted by the projects, stakeholders with an interest in transmission infrastructure costs, and transmission owners. Other stakeholders and the public are also invited.

One practical note: if your concern is the design, routing, or scope of a specific project, that belongs in the relevant planning process, not this consultation, and Ofgem will treat it as out of scope here. Confine responses to the funding question: whether the proposed early-construction spend is in the consumer interest and proportionate to the irrecoverable-cost risk.