West of Orkney Wind Farm Grinds To A Halt Over Unfair Grid Transmission Charges

21st January 2026

The West of Orkney wind farm is a major offshore wind development planned off the north coast of Scotland about 30 km west of Orkney with up to 125 turbines and around 2 GW capacity, enough to generate electricity for roughly two million homes. It had previously secured key planning approvals and offshore consent from the Scottish Government as part of the ScotWind leasing round.

Why it's been paused

The developers have halted further investment and effectively paused progress because of very high electricity transmission (grid connection) charges under the current UK charging regime. These charges are applied to generators to pay for building and maintaining the high-voltage network:

The system penalises projects far from major demand centres (like Scotland) because transmission costs are higher for long distances.

Developers say this makes the project uncompetitive compared with wind farms in the south of the UK, even though the wind resource in the north of Scotland is excellent.

Transmission charges can add up to ~30 % more cost, according to project leaders — and without reform of these charges, further spending and investment has been stopped.

Government review

The UK government is reviewing how transmission charges work as part of a broader reform of the electricity market, but there's no confirmed change yet. This review will influence whether the project can resume or adjust economically to continue moving toward construction.

West of Orkney wind farm was progressing with planning and consent.

Developers paused the project because of unfavourable transmission cost rules.

The pause isn’t due to environmental or legal blockages but economic and regulatory barriers in the current grid-charging system.

What are transmission charges?

When a wind farm generates electricity, it has to use the high-voltage national grid to move that power to where it’s used.

To pay for building and maintaining that grid, the UK uses Transmission Network Use of System (TNUoS) charges.

Generators (like wind farms) pay charges

Consumers also pay charges

The amount depends on where you are connected

Location-based charging (the key issue)

The UK system is location-based, meaning:

If you generate power far from major demand centres (London, Midlands, south England),

You pay higher charges, because the grid has to move electricity a long distance.

In practice:

Wind farms in northern Scotland & islands → highest charges in Europe

Power stations in southern England → low or even negative charges (they can be paid to generate)

West of Orkney is about as far from London as you can get — so it’s hit hard.

How bad are the charges?

For northern Scottish offshore wind farms:

Charges can be £7-£10 per megawatt-hour

That can be millions of pounds per year

Over a project’s lifetime, it can wipe out profitability

Developers estimate this can add 20–30% extra cost compared with similar projects in the south.

Why this feels "backwards" to developers

From a climate and energy-security point of view:

The best wind resources are in the north and offshore

Scotland exports huge amounts of clean power to the rest of the UK

Offshore wind reduces gas imports and stabilises prices

Yet the system:

Penalises projects where wind is strongest

Rewards generators closer to cities, even if they’re fossil-fuel based

That’s why developers argue the system is economically irrational and anti-renewables.

Why West of Orkney paused specifically

West of Orkney:

Is a very large (≈2 GW) project

Needs major new transmission infrastructure

Would face very high long-term charges

Developers decided:

It’s too risky to keep spending money until the charging rules change.

So the project is paused, not cancelled — waiting for reform.

Is the system changing?

Possibly — but slowly.

The UK government and Ofgem are reviewing:

Zonal pricing

Rebalancing who pays grid costs

Reducing penalties for renewables in remote areas

However:

No final decision yet

Developers need certainty before committing billions

Why this matters beyond one wind farm

If unchanged, the system could:

Delay or cancel multiple Scottish offshore wind projects

Slow the UK’s net-zero targets

Increase reliance on gas-fired power in the south

West of Orkney is paused because the UK grid charging system makes clean power from northern Scotland financially unattractive — despite being exactly where the best wind is.