The SSE subsidiary has been working with the energy regulator Ofgem to deliver an open, competitive process to ensure the most economic and efficient option is taken forward when the Lerwick Power Station comes to the end of its operational life.
Prospective bidders are being asked to submit expressions of interest and complete a pre-qualification questionnaire by midday on Friday 8 May 2015. Those that show they have the capabilities required will be invited to tender for the available contracts in June 2015.
SHEPD project manager Heather Fleming said: “We welcome the informal interest which a diverse range of businesses and organisations have already shown in this exciting opportunity. We have now published further details of the electricity demand on our network in Shetland over recent years and the basic requirements that have been agreed following consultation.”
SHEPD expects the delivery date for the successful solution to be 2019, but adds that some bidders may want to propose earlier or later delivery dates.
The Shetland Islands are located about 200 kilometres north east of mainland Scotland and are not connected to the UK electricity network.
Currently, the main sources of electricity generation which can respond to customer demand are oil- and gas-fired power plants Lerwick and Sullom Voe, both of which are expected to close in the next few years.
In July 2013, SHEPD submitted a plan to Ofgem for a new dual-fuel power station north of Lerwick to be delivered in 2017. However, the proposal was rejected on the grounds of cost.
The Shetland Islands offer high potential for the development of renewable energy resources – wind, wave and tidal – with innovative smart grid solutions to manage their contribution to the network.
A trial project called Northern Isles New Energy Solutions (NINES) is already delivering some energy storage and domestic demand side management measures.