What options has Ørsted put forward to bring some of the electricity generated by Mooir Vannin to the Island?
Ørsted is working with Manx Utilities and Isle of Man Government to explore preferred options to bring power to the island and has confirmed it will commit investment to bring power generated by Mooir Vannin to the island - should the Isle of Man Government and Manx Utilities choose to pursue it.
There are two options that have been identified for the current proposal:
- A new electricity cable directly between the wind farm and the island.
Or
- Connect the wind farm solely to the UK grid, with the option of supplying the island through the existing Manx 1 IOM-UK subsea interconnector via a Power Purchase Agreement (PPA).
What are the benefits of using the existing Manx 1 IOM-UK interconnector?
The first option above would mean installing a direct connection between the wind farm and the island’s shoreline, and a new underground cable from the shoreline to the electricity grid.
The second PPA option would make use of infrastructure that is already in place, the Manx 1 interconnector.
Under both options, Ørsted could make a long-term contribution to the island’s energy security ambitions - providing access to a major source of renewable energy generated within the island’s territorial waters.
Rising electricity prices are a major concern for everyone on the island, including businesses because many report that energy is their biggest overhead cost.
Based on the current proposal of 87 turbines, initial analysis shows a PPA approach could support reductions in electricity bills of around 10% to 15% for residents and businesses across the island.
While Ørsted, as the generator of electricity, would not determine the retail prices paid by consumers, the initial analysis demonstrates the potential for Mooir Vannin to lower the underlying cost of electricity supplied to the island.
However, any future decisions on how savings are passed through to homes and businesses would ultimately rest with Manx Utilities and the Isle of Man Government.
How would a PPA deal work?
A PPA deal is likely to be supported through a REGO (Renewable Energy Guarantee of Origin) which would allow the Isle of Man to verify that green power generated from Mooir Vannin was being supplied to the island.
In this scenario green electricity from Mooir Vannin would contribute to the Isle of Man Government’s long-term net-zero, climate change and energy security targets, and in the private sector would support ESG (Environmental, Social & Governance) strategies which are important to many international businesses that are major contributors to the island’s economy.
The Isle of Man’s most recent Business Environment and Conditions report identified energy costs as one of the key concerns facing local businesses.
What energy security & other benefits would Mooir Vannin bring to the Island?
Beyond potential wholesale electricity cost savings, access to large-scale renewable energy could provide a range of wider benefits for the Isle of Man - including increased energy security by reducing exposure to volatility in international gas markets.
Against a backdrop of increasing global demand for clean energy and ongoing uncertainty in international energy markets, access to renewable energy is expected to become an increasingly important factor in supporting business competitiveness and attracting future investment.
Jamie Baldwin, Mooir Vannin project director at Ørsted, 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 and the Isle of Man’s long-term energy security.
The final decision on the preferred approach will remain entirely with the Isle of Man, but we want to make it absolutely clear that we are committed to delivering a viable source of renewable energy to the Island.’