SSEN Transmission, which is 75% owned by electricity infrastructure company SSE plc (SSE.L), on Friday announced a £1 billion, 12-year bank facility backed by an £800 million financial guarantee from the UK Government's National Wealth Fund. The company said the financing will support four major grid upgrade projects currently under way in the north of Scotland.
The syndicated facility is backed by a group of SSEN Transmission's relationship banks, led by Bank of America, and includes BBVA, HSBC, JP Morgan, Lloyds, MUFG, NatWest and Santander.
The financing is ringfenced as a Green Loan to fund 4 projects including the Skye Reinforcement, Argyll and Kintyre 275kV Strategy, the Orkney Connection, and the jointly developed Eastern Green Link 2 (EGL2) project.
The company said the projects will connect Orkney to the transmission grid for the first time and significantly strengthen infrastructure serving communities including Skye, Fort Augustus, Argyll and Kintyre.
SSEN Transmission noted that the National Wealth Fund-backed financing provides longer-dated lending that better aligns with the lifespan of grid assets and will help ensure the swift progression of projects independently assessed as necessary by the National Energy System Operator and energy regulator Ofgem.
"This new Bank Facility supported by the National Wealth Fund financial guarantee provides an excellent source of funding diversification, and with a three-year availability window helping to manage liquidity for SSEN Transmission," said Barry O'Regan, SSE's Chief Financial Officer.
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