UK and Norway to Lay World's Longest Subsea Power Cable

A windmill is seen near the ocean in Utsira, a North Sea island of just 6 square km (2.3 square miles) and home to 210 people who already get most of their power from two onshore windmills, April 22, 2008. Wojciech Moskwa/REUTERS

The UK and Norway are to construct the world's longest subsea power cable which will transmit enough hydro-power to supply 750,000 British homes.

Norwegian firm Statnett and the UK's National Grid signed the €2 billion deal yesterday, with the project set to be completed by 2021, a year later than originally planned.

The 730km cable - 150km longer than the existing line between Norway and Holland - has the capacity to carry 1.4 gigawatts of low-carbon electricity across the North Sea to British soil, potentially reducing peak prices for energy consumers.

The UK energy secretary, Ed Davey, said that access to the Norwegian green hydropower reserves would provide back-up power for Britain's wind farms and save people money.

He added: "It won't be all one-way traffic. We are in the process of investing heavily in new low-carbon generation. In the future we would expect that there will be times when our generation exceeds our demand and we are able to export clean power to Norway in return."

The cable will start in Kvilldal, near Stavanger, and reach the UK at Blyth, just north of Newcastle.

Auke Lont, chief executive of Statnett, said: "Not only is this a technically impressive project where we will set a new world record, it is also an important contribution to the increase of renewable energy production on both sides."

The European Union is expected to contribute €31m towards to the project as part of its drive to level off price differences across the continent by developing a more interconnected power market.

Despite the cost of the cable, the project could save UK consumers up to £3bn over 25 years, according to analysis by the UK Department of Energy and Climate Change.

In February, Statnett confirmed their investment in a 1.4 GW cable from Norway to Germany, although the completion date was put back a year to 2019 due to a shortage of capacity to produce the cable.

It is hoped the two cables will reduce the growing power surplus in Norway which has driven down power prices in the region to their lowest levels since 2007.