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CRU Proposed Decision Paper for Processing Phase 1 Offshore Grid Connection Applications

  • Ireland
  • ESG
  • Energy and infrastructure - Clean energy
  • ESG

28-10-2021

On 11 October 2021, the Commission for Regulation of Utilities (“CRU”) published its proposed decision paper (CRU/21/112) (the “Proposed Decision”), which puts forward proposals for how the next stage of processing grid connection applications will be carried out for ‘Phase 1’ projects. 

The Phase 1 projects (which were previously called ‘Relevant Projects’ under the Transitional Protocol issued pursuant to the MPDM Bill 2020) are the North Irish Sea Array, Oriel Wind Park, Dublin Array (2 projects Bray and Kish Banks), Codling Wind Park (2 projects, Codling I and Codling II) and Skerd Rocks Wind Farm. The Arklow Bank project is also included in the Phase 1 category of projects.  

The Proposed Decision proposes that EirGrid (as TSO for the offshore grid) will issue a ‘Grid Connection Assessment’ (“GCA”) to Phase 1 projects, which will detail the method and cost associated with connecting Phase 1 projects to the transmission system at its onshore connection point(s). A GCA will be required for each Phase 1 project to subsequently receive a full grid connection offer from EirGrid. It is also intended that a GCA will fulfil the criteria for grid connection for Phase 1 projects bidding into the first offshore renewable electricity support scheme (“ORESS 1”) auction.

The proposals relating to the GCA in the Proposed Decision are as follows:

GCA Timeline

EirGrid will open a four week GCA application window within two weeks of the final decision. Phase 1 projects must apply within this timeframe, otherwise they will lose their Phase 1 project status. EirGrid will then issue a GCA within 90 days of the application window closing, or 120 days for competitive locations.

Maximum Export Capacity (MEC)

The GCA application will request a single Maximum Export Capacity (MEC) and the applicant’s stated preference for onshore connection point location(s).

Connection Point Allocation

The Proposed Decision contains three different options for allocating onshore connections where there is competition for one or more connection locations:

  1. Option 1 - where there is competition for one or more connection point locations, the locations will be allocated on the basis of set criteria, including ensuring that each connection point location is developed by only one applicant (meaning that connection point location should be able to take all requested MEC from an applicant);
  2. Option 2 - the connection point location(s) identified by EirGrid as having the best deliverability in the Dublin region would have more than one project connecting to multiple connection points at the location(s). Applicants may have a shared connection method and costs under this option; and
  3. Option 3 - a detailed assessment of method and costs of connection at the locations will be carried out by EirGrid. According to the Proposed Decision, this should facilitate a collaborative outcome between the relevant competing applicants and EirGrid for connection point allocation. If an agreed outcome cannot be reached during the required period before GCAs need to be finalised, EirGrid will assign the connection point locations to the projects using general principles of assignment used for onshore connections.

GCA Conditionality

 

The ability to apply for a GCA is dependent on being able to apply for, or hold, a Maritime Area Consent and (a) be eligible to apply for (and subsequently take part in) ORESS 1 or (b) confirm a Corporate Power Purchase Agreement in advance of ORESS 1.

GCA Validity

It is proposed that once issued, the GCA will be valid for the earlier of (a) two years after issuance or (b) three months before eligible Phase 2 projects are due to submit their initial grid applications for processing. 

Qualification for full grid connection offer

Phase 1 projects with a GCA will qualify for a full grid connection offer through confirmation of either (a) ORESS 1 success and acceptance of an ORESS 1 offer letter; or (b) a financial director declaration of Corporate Power Purchase Agreement. The CRU expects that Phase 1 projects that fulfil either of these criteria, will be able to receive a full grid connection offer in advance of confirmed planning permission of generation and grid connection, however the grid connection agreement will not be executed until planning permission is granted. The CRU will consult on the terms and conditions for the full grid connection offer by the end of 2021.

The CRU is seeking views on the Proposed Decision by Monday, 22 November 2021, following which, it will decide on the criteria for the GCA in early Q1 2022.

For more information please contact:

Mark Varian, Partner, Energy - MarkVarian@eversheds-sutherland.ie

Jennifer Burke, Senior Associate, Energy – JenniferBurke@eversheds-sutherland.ie

Phelim McGeady, Associate, Energy – PhelimMcGeady@eversheds-sutherland.ie