Letters / Constraint costs versus community benefit

Shetland continues to host major renewable infrastructure, yet remains burdened with some of the highest electricity tariffs in the United Kingdom.

Viking Wind Farm illustrates this imbalance. Between August and December 2024, it received more than £9.25 million in constraint payments because much of its output could not be exported due to grid limitations.

In June 2025 alone, constraint payments exceeded £1.1 million, with nearly 78 per cent of Viking’s generating potential curtailed. These payments, made by the National Energy System Operator (NESO), are ultimately recovered from consumers through industry charges on electricity bills.

By contrast, Viking contributes about £2.2 million each year to the local community benefit fund—an estimated £72 million over 25 years once index-linking is included. As of 4 September 2025, roughly £1.4 million had been distributed across 69 projects, supporting initiatives such as youth clubs, bursaries, housing, and community facilities.

While welcome, these benefits are indirect. They do not alter the reality that many Shetland households continue to face extreme fuel poverty while paying among the highest energy costs in the country.

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The disparity is stark: in five months of 2024, constraint payments exceeded four years’ worth of community benefit funding, and in a single month of 2025 they exceeded half a year’s allocation.

There are no binding commitments to reduce local tariffs, and while some employment and apprenticeship schemes exist, they are not underpinned by enforceable targets. The HVDC transmission link is designed to export electricity and support wider security of supply, not to deliver cheaper power to Shetland.

If developers and policymakers are going to claim that curtailments are temporary, they should publish clear evidence and a timetable for constraint relief, and accept enforceable conditions linked to measurable reductions in curtailment.

Shetland has already made a substantial contribution to the United Kingdom’s decarbonisation, and its residents are paying a high price for doing so. Until the imbalance between local costs and national benefits is addressed, no further industrial-scale energy development should take place in Shetland.

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If this is presented as a “just transition,” it is one that disproportionately burdens Shetlanders—who subsidise infrastructure from which they gain little meaningful relief and only token reward.

Adrian Brockless
Yell

References:

Local Energy Scotland ‘Viking Wind Farm’. Available at: https://localenergy.scot/project/304/
National Energy System Operator (NESO) (2024) ‘BSUoS Fixed Tariff 2023–24 – Final (covering Apr–Sep 2025)’. Available at: https://www.neso.energy/document/320611/download
National Energy System Operator (NESO) (no date) ‘Balancing Services Use of System (BSUoS) charges’. Available at: https://www.neso.energy/industry-information/charging/balancing-services-use-system-bsuos-charges
National Grid ESO (2024) ‘Overview of our electricity charges for Users’ (briefing, 20 November). Available at: https://www.nationalgrideso.com/document/138176/download
Ofgem (2022) ‘CMP308: Removal of BSUoS charges from generation’ (Decision, 25 April). Available at: https://www.ofgem.gov.uk/decision/cmp308-removal-bsuos-charges-generation
Ofgem (2025) ‘Get energy price cap standing charges and unit rates by region’. Available at: https://www.ofgem.gov.uk/information-consumers/energy-advice-households/get-energy-price-cap-standing-charges-and-unit-rates-region
Scottish Government (2025) ‘Scottish House Condition Survey: 2023 Key Findings – Fuel poverty’. Available at: https://www.gov.scot/publications/scottish-house-condition-survey-2023-key-findings/pages/3-fuel-poverty/
Shetland Community Benefit Fund (2025) ‘VCF Year 1 Funding’ (News, 4 September). Available at: https://www.scbf.org.uk/news/vcf-year-1-funding
Shetland Community Benefit Fund ‘The story of Shetland Community Benefit Fund’ (Background). Available at: https://www.scbf.org.uk/resources/library/background-to-scbf
Shetland News – Cope, C. (2024) ‘First minister sympathetic to calls for “Shetland tariff”’ (27 May). Available at: https://www.shetnews.co.uk/2024/05/27/first-minister-sympathetic-calls-shetland/
Shetland News – Nicolson, R. (2025) ‘Viking third in list for unused energy in 2024 despite August opening’ (8 January). Available at: https://www.shetnews.co.uk/2025/01/08/viking-third-list-unused-energy/
SSE Renewables (2024) ‘Landmark moment as SSE powers up Viking Wind Farm on Shetland’ (29 August). Available at: https://www.sserenewables.com/news-and-views/2024/08/landmark-moment-as-sse-powers-up-viking-wind-farm-on-shetland
SSE Renewables (2025) ‘£1million distributed from Viking Community Fund’ (16 April). Available at: https://www.sserenewables.com/news-and-views/2025/04/1million-distributed-from-viking-community-fund
SSE Renewables (no date) ‘Viking Wind Farm – project overview (443 MW; community fund ~£72m indexed)’. Available at: https://www.sserenewables.com/onshore-wind/great-britain/viking
SSEN Transmission (2024) ‘World‑leading transmission project energised – first in Europe’ (news on energisation of the Shetland HVDC link, August). Available at: https://www.ssen-transmission.co.uk/news/news–views/2024/8/world-leading-transmission-project-energised–first-in-europe
SSEN Transmission (no date) ‘Shetland HVDC Link – Project overview’. Available at: https://www.ssen-transmission.co.uk/projects/project-map/shetland