The regulator’s proposal is £173.9m less than the funding request proposed by project developer Scottish Hydro Electricity Transmission (SHE Transmission).

Ofgem has launched a four-week consultation on the proposals and a final decision on funding will be taken in December 2014.

The project intends to deliver 1.2GW of renewable electricity through a new subsea transmission link between Caithness and Moray in Scotland.

Construction work on the link, which will connect the electricity grid on either side of the Moray Firth, is expected to start in the next few months with planned completion in 2018.

In September 2014, ABB secured a contract worth more than $800m to provide the Caithness-Moray high-voltage direct current (HVDC) power transmission link.

ABB will design, engineer, supply and commission two 320 kilovolt land-based HVDC Light converter stations.

The company will provide a 1,200MW station at Blackhillock in Moray and a 800MW station at Spittal in Caithness.

The deal also requires ABB to deliver submarine and underground cables covering a total transmission length of about 160km.

ABB claims that the project is the largest investment in northern Scotland’s electricity network since the 1950s hydro development era.

Upon completion, the Caithness-Moray link will provide enough energy for about 2,000,000 residents in Scotland.

Image: The new link will connect the electricity grid on either side of the Moray Firth. Photo: Courtesy of SSE.