Ørsted says its windfarm plans could cut electricity bills by between 10 and 15%.

The company has confirmed it will commit investment to bring power generated by the proposed Mooir Vannin offshore windfarm to the island.

One option put forward by Ørsted would see the wind farm connected directly to the Isle of Man via a new Island Link, creating a long-term connection between renewable energy generated in Manx waters and the island's electricity network.

An alternative option would instead use investment that would have been used to construct a direct connection to fund a long-term power purchase agreement (PPA).

Under a PPA approach, the existing interconnector between the Isle of Man would be used to deliver reduced cost electricity from Mooir Vannin for all Manx household and businesses.

Based on the current proposal of 87 turbines, Ørsted says initial analysis shows a PPA approach could support reductions in electricity bills of around 10% to 15% for residents and businesses across the island.

Ørsted would not determine the retail prices paid by consumers, and any future decisions on how savings are passed through to homes and businesses would ultimately rest with Manx Utilities and the government.

The company also says Mooir Vannin has the potential to deliver significant long-term economic benefits for the Isle of Man.

It says current analysis indicates the windfarm would generate at least £2bn in combined taxation and rent – equivalent to around £55-60m per year.

Ørsted said annual revenue of this scale is equivalent to the island’s forecast net expenditure on all primary schools and University College Isle of Man combined.

Jamie Baldwin, Mooir Vannin project director, said: ’For the first time, the Isle of Man has an opportunity to secure access to a large-scale source of renewable energy generated in its own territorial waters with the potential to support lower electricity costs - but this is about much more than electricity bills.’

The windfarm project can only proceed with the approval of the Council of Ministers.

It is up to Manx Utilities and Isle of Man Government to decide whether to proceed with one of the two options to bring power to the island.

If given the go ahead, Ørsted have also pledged to establish a Community Investment Fund worth £1.5m per year for the first 15 years of operation, supporting local community initiatives and projects.