Executive director Nick Winser said there was “massive value” in connecting to other markets and called on regulators to set out how operators can earn a return on overseas electricity transmission links.
The network company expects to make final investment decisions on power cables to France, Belgium and Norway in the next two years. A one-way link to import renewable power from Ireland and subsea lines to Denmark and Iceland are in earlier stages of development.
Speaking after National Grid reported on its first half performance for 2013, Winser said: “We think interconnection is a really important part of the energy picture, so we will continue to work on that. What is critical is regulatory certainty about how these links are going to be remunerated. Otherwise, we are not going to be able to take forward these interconnectors and we think there is massive value in getting these built.
“In particular, the wholesale electricity price for our neighbours is cheaper than here. If you build more interconnectors, you will bring costs down here. With the strong focus on affordability at the moment, that is something we need to do.”
Winser said National Grid was “investing strongly” this year despite deciding to defer some network upgrades due to slower than expected development of power generation projects. The company invested £1.7 billion in the six months to 30 September 2013 and expects to spend a similar sum again by year end.
Earlier this month, National Grid revealed a 27km transmission upgrade in East Anglia was being put on hold due to delays in generation coming online.
Winser attributed the delays to uncertainty over government’s Electricity Market Reform package but said it would “probably be substantially resolved” in 2014.
Despite a slowdown in new generation coming online, Winser played down fears of blackouts this winter, saying: “ margins have come down to something that is tighter than we are used to but not unprecedented.”