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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 be completed in 2018.

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

SSE said confirmation of funding arrangements is anticipated to bring SHE Transmission’s total investment in the north of Scotland’s network for the next financial year to about £600m.

The revisions to the regulatory arrangements will enable SHE Transmission to apply for further funding during construction if needed.

SSE director of transmission David Gardner said: "The investment of around £600m for financial year 2015/16 will see work commencing on the vital Caithness-Moray subsea link, along with further investment in a number of other approved projects, all unlocking renewable sources of energy for decades to come.

"Importantly, local people will benefit from the hundreds of jobs it will support, with more than 100 apprentices and graduates being trained with the vital engineering and technical skills needed to serve the network across the North of Scotland in the future."

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