Scotland business

Scottish Power and SSE to face competition for pylon and grid projects

Electricity tower Image copyright PA

National Grid and Scotland's two main power companies face competition for the first time in building pylons and grid networks.

Ofgem has said customers would benefit from competition to build large projects competitively.

Three firms have monopolies on building and owning grid connections.

National Grid covers all of England and Wales. A division of Scottish Power has southern Scotland, and a subsidiary of SSE has the northern part.

The two Scottish companies retained this role as a legacy from their days as publicly-owned electricity boards.

'Better value'

The proposal from industry regulator Ofgem, announced on Monday, would only cover projects worth more than £100m.

It said the first competitive tender could take place in 2017, after consulting on how the system will work, and price controls on new entrants to the electricity grid.

The regulator claimed that competition on offshore grid connections has saved consumers between £200m and £400m.

Ofgem chief executive Dermot Nolan said: "Part of our role is to ensure that customers pay no more for energy infrastructure than they have to.

"In future we will tender out high-value electricity infrastructure projects onshore.

"This ensures that customers get even better value for money from Britain's grids."

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