Ofgem has greenlit early construction funding for a series of major electricity transmission projects in Scotland — completing approval across all 26 schemes in its Accelerated Strategic Transmission Investment (ASTI) programme and clearing the way for one of the most significant grid build-out programmes in modern Scottish history.
The decision, confirmed by the regulator on Tuesday 12 May 2026 and reported by Bloomberg the same day, lets transmission operators lock in HVDC cables, substation components and other long-lead equipment before construction is fully consented — a critical advantage at a moment when global demand for grid components is at record levels.
What has been approved
The two headline projects approved on 12 May are both managed by SP Transmission (SPT):
- Denny to Wishaw 400kV Reinforcement Project — a new north-to-south overhead power line corridor through Scotland’s central belt, capable of carrying 1,000MW of clean power. SPT has been awarded 55% of the project cost.
- Tealing–Kincardine Upgrade Project (TKUP) — a major substation and overhead-line upgrade across Glenrothes, Westfield and Mossmorran, enabling other ASTI projects including the planned Eastern Greenlink 4 “electricity superhighway.” TKUP has been awarded 53% of the project cost.
In parallel, Ofgem has approved early construction funding for eight further projects managed by Scottish Hydro Electric Transmission Plc (SHET) — six onshore and two offshore. These include the Arnish to Beauly HVDC link, which will transport 1.8GW of renewable generation from Western Isles wind farms; and the Spittal to Peterhead subsea link, a 2GW HVDC project transporting ScotWind output across the north and east of the country.
Beauly to Loch Buidhe, Beauly to Blackhillock, Blackhillock to Peterhead, the Beauly–Denny 275kV-to-400kV conversion, and the East Coast Onshore 400kV programme complete the SHET package.
The aggregate capacity unlocked across these schemes, once delivered, will support multiple gigawatts of renewable generation reaching homes and businesses — and is expected to begin delivering benefits to consumers from 2030 onwards, subject to planning consents and construction timelines holding.
Why early funding matters
Early Construction Funding (ECF) allows transmission operators to start procurement, survey and design work before full project assessment is complete. The headline economic argument is straightforward: many countries are decarbonising their grids simultaneously, and key components — HVDC cables in particular — are in critically short supply globally.
“By unlocking early funding for these projects, we aim to accelerate their delivery,” said Beatrice Filkin, Ofgem’s Director of Major Projects. “This is crucial for strengthening Britain’s energy security and cutting constraint costs and exposure to volatile international gas prices by providing more grid capacity.
“Early funding helps transmission operators secure scarce components, avoid supply-chain delays, and deliver the grid upgrades needed to power homes and businesses with more clean, homegrown energy.”
Filkin also addressed the consumer-protection dimension: “As financial regulator of these projects, we’ll protect consumers by ensuring any early spend is targeted, any unused funding is returned, and costs can only be recovered where there’s a clear benefit for billpayers.”
She was clear the approval is not planning consent — that remains a matter for the relevant planning authorities. The Beauly-Denny corridor in particular has historically faced significant community opposition, and the new ASTI projects will need to navigate similar consultations.
The economic prize for Scotland
For Scotland’s high-growth business community, the ASTI announcement is materially significant for several reasons.
Constraint costs. When Scotland’s wind farms generate more electricity than the grid can carry south, generators are paid to switch off. Those constraint payments are added to consumer bills UK-wide and have run into hundreds of millions of pounds in recent years. Unlocking transmission capacity reduces those payments — improving the economics of operating Scottish renewables and the wider case for Scottish generation investment.
Supply chain opportunity. The build-out will require thousands of skilled jobs across engineering, manufacturing, civils, surveying and project management — many of them clustered in central-belt and north-east Scotland where SPT and SHET activity is concentrated. For Scottish supply chain businesses with relevant capabilities, the next five to ten years represent one of the largest infrastructure procurement waves in living memory.
Renewables monetisation. ScotWind, INTOG and onshore wind developers all face the same fundamental problem: generation built in Scotland needs to reach demand centres elsewhere. The 26 ASTI projects collectively address that problem at the scale required to unlock the multi-gigawatt pipeline of consented and pre-consent Scottish projects.
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What is not yet resolved
Three caveats apply. First, planning consents remain to be secured for many of the schemes — some across politically sensitive corridors. Second, Ofgem’s full efficiency assessment, including review of costs incurred during the early-construction phase, will take place at the full project assessment stage. If costs are deemed inefficient, they will not be allowed to be recovered. Third, the 2030 benefit-delivery target depends on construction running to programme — a substantial undertaking across the volume of work involved.
For now, however, the decision represents one of the clearest signals to date that the regulatory architecture supporting Scotland’s energy transition is hardening up — and that the country’s role in delivering UK clean-power ambitions remains central, not peripheral.
