> ## Content Index
> Fetch the complete content index at: https://www.thequarry.media/llms.txt
> Use this file to discover other available public pages before exploring further.

# Electricity could cost £980 a year more by 2036 under new interconnector plans
- URL: https://www.thequarry.media/electricity-tariff-rises-of-up-to-980-a-year-by-2036-under-new-interconnector-plans/
- Published: 2026-11-09T17:33:02.000Z
- Updated: 2026-11-09T17:52:10.000Z
- Author: The Quarry
- Tags: News

- Guernsey proposes second electricity interconnector with two route options: £113m link via Jersey by 2030 or £209m direct link to France by 2034, with Jersey route offering lowest 30-year cost of £4.886bn
- Households face bill increases of £853 by 2036 under Jersey route (to £2,542 from current £1,689), though long-term increases remain below inflation over full 30-year period
- Second cable removes single point of failure in import system, addresses aging Vale Power Station fleet with generators over 50 years old, and enables transition away from heavy fuel oil
- Authorities propose graduated reduction in on-island generation security standards from N-2 to N once second interconnector operational, saving £1.85m annually in generation costs
- Policy & Resources Committee would receive delegated authority to provide loans up to £136m (Jersey route) or £253m (France route), with authorities investigating tariff mitigation measures including potential States equity injection

Listen to this article

0:00

/0

1×

Households could see their annual electricity bills rise by up to £980 by 2036 [under proposals for a second interconnector](https://parliament.gg/parliamentary-business/propositions/P2026-92?ref=thequarry.media) to secure the island's energy supply, according to a policy letter published by Environment & Infrastructure and the States' Trading Supervisory Board.

The authorities have identified two viable routes for additional interconnection, with the cheaper Guernsey-Jersey 2 option estimated to cost £113 million and requiring electricity tariff increases of RPI plus 2% from 2027 to 2036\. The alternative route directly to France would cost £209 million and require steeper initial increases of RPI plus 5% in 2027-2028.

For a typical household on the Super Economy 12 non-heating tariff, currently paying £1,689 annually, bills would rise to £2,542 by 2036 under the Guernsey-Jersey route — an increase of £853 - compared to the inflation-only scenario of £2,278\. The direct French route would see bills reach £2,669 by 2036, an increase of £980.

However, over the full 30-year period to 2054, all options show average annual increases below the assumed 3% inflation rate. The joint committees stated in the States report they wanted debated in December: "The Island will benefit from a modernised electricity system, improved security and resilience of supply, reduced exposure to ageing thermal generator infrastructure and a transition toward increased lower carbon electricity generation, without electricity costs increasing faster than inflation over the longer-term."

The Guernsey-Jersey 2 option would be commissioned by 2030 and connects into the existing Channel Islands Electricity Grid network. It requires total capital expenditure of £464.787 million over ten years. The Guernsey-France 1 alternative would not be commissioned until 2034 and requires total capital expenditure of £554.680 million, alongside complex new approvals from the French government post-Brexit.

A 30-year enterprise financial planning model comparing the two interconnector options with maintaining the status quo shows the Guernsey-Jersey route delivers the lowest total cost at £4.886 billion, compared to £4.934 billion for the status quo and £5.011 billion for the France route.

"The choice facing the Island is not whether investment in the electricity system should occur, but how that investment should be undertaken. There is no credible 'do nothing' option," the authorities stated.

The committees are proposing that the Policy & Resources Committee should have delegated authority to provide loans or loan guarantees of up to £136 million for the Guernsey-Jersey route or £253 million for the France option. An additional £51 million would be available for refinancing existing private sector borrowings. All loans would be fully repayable by Guernsey Electricity from revenues with no residual costs to the States of Guernsey.

Alongside the interconnector investment, the authorities are proposing a graduated reduction in security of supply standards for on-island electricity generation. The current N-2 standard requires sufficient thermal generation to meet peak demand with the two largest generators unavailable. This would move to an N-1 standard once an interconnector contract is signed, and to an N standard once the second interconnector becomes operational.

"A transition from N-2 to N would reduce the costs to the Island of providing back-up generation by a recurring £1.85m per annum compared to the Status Quo," according to the policy letter.

The island currently imports 92% of its total annual electricity demand through a single interconnector with 63 megawatts capacity, which could potentially increase to 70 megawatts. Peak electricity demand stands at 94 megawatts and is forecast to rise to 157 megawatts by 2050, or 125 megawatts with demand management measures.

On-island thermal plant at Vale Power Station operated for 1,282 hours in 2025, representing 14.5% of the time and 8% of total electricity supplied. However, the current generation fleet is aging significantly, with the oldest generators having served over 50 years by 2030.

The fleet includes seven diesel engines ranging from 11 to 16.5 megawatts each and three gas turbines from 10 to 18.5 megawatts each. Many assets are beyond normal reliable operational life, and C-Station output is limited to 33 megawatts due to cooling capacity constraints.

The timing of the chosen interconnector route has significant implications for on-island generation. The Guernsey-Jersey option, with 2030 commissioning, would require no further replacement investment before the interconnector becomes operational and would enable C-Station decommissioning from 2032, allowing transition away from heavy fuel oil.

The France route, with 2034 commissioning, would likely require either costly life-extension of C-Station assets or investment in new thermal plant or energy storage that may become redundant once the interconnector is operational.

A second interconnector addresses critical vulnerabilities in the current single-cable system. The island experienced interconnector outages in 2012 and 2018, which forced prolonged reliance on hydrocarbon-powered generators. A second cable would remove this single point of failure, allow maintenance without loss of import capacity, reduce exposure to fuel importation risks, and enable reduction in on-island thermal generation requirements.

With the Guernsey-Jersey 2 option connecting to separate parts of the Channel Islands Electricity Grid network in Jersey, there would be no single point of failure across the system, as three Normandie cables connect into two sections of network.

Additional interconnection has been consistent States policy since 2012, appearing in the Energy Resource Plan, the 2014 Guernsey Electricity Supply Future Strategy, the 2020 States of Guernsey Energy Policy 2020-2050, and the 2023 Electricity Strategy for Guernsey. The 2023 strategy concluded that decarbonising through additional interconnection and local renewables is the optimum long-term approach and lower cost than maintaining single generator and on-island generation.

"Maintaining the status quo would be the most expensive option over the longer term," the committees stated.

The joint committees and Policy & Resources Committee are investigating options to mitigate near-term tariff increases, including potential equity injection from the States and adjusting phasing or structure of debt repayments. Results are expected to be included in the forthcoming Medium Term Financial Plan.

"The joint committees and the P&RC recognise that the necessary tariff increases, particularly in the earlier years, will be difficult for some households and businesses," according to the policy letter.

Beyond States loans, Guernsey Electricity is exploring alternative funding options including commercial borrowing with or without States guarantee, sustainable financing through green bonds or loans, third-party asset ownership, partial flotation, and private placement. These are longer-term options and a blended approach may be required given project timelines.

The policy letter proposes delegated authority to the States' Trading Supervisory Board and Policy & Resources Committee rather than requiring States approval of the final business case. The authorities argue that public disclosure of detailed negotiating positions, commercial assumptions and pricing information could "materially prejudice GEL's ability to secure the most advantageous outcome" and weaken negotiating leverage.

Before approving funding, Policy & Resources Committee would require confirmation of States' Trading Supervisory Board approval of the business case, confirmation Guernsey Electricity can service and repay lending from revenues, independent assessment of the States' borrowing capacity, appropriate legal and financial arrangements, agreed drawdown schedule linked to milestones, and monitoring and reporting arrangements.

If Guernsey-Jersey 2 is the preferred option, Guernsey Electricity must commit by the second quarter of 2027 to maintain opportunity for 2030 delivery. The utility estimates spending £1.5 million by the end of 2026 and requiring up to £4.1 million additional before cable contract signing, covering route surveys, technical investigations, engineering design, environmental assessments, procurement activities and stakeholder engagement.

Finalization of the business case requires sustained engagement with cable suppliers and installers, high voltage substation equipment manufacturers, Réseau de Transport d'Électricité, Électricité de France, planning and environmental agencies in Guernsey, Jersey and France, and Jersey Electricity.

The 2020 Energy Policy established six objectives ranked in order of priority: security and resilience of supply, greater energy independence, consumer value, appropriate competition and consumer choice, minimise carbon emissions and environmental impact, and transparency and fairness. The Electricity Strategy and this implementation programme seek to balance these objectives.

If approved, the proposals would rescind and replace Resolution 2(d) from the September 2023 Electricity Strategy, which incorrectly limited the security criterion reduction only to scenarios with a direct France interconnector rather than any additional interconnection regardless of destination.

The maximum funding envelopes include contingency and cost indexation provisions and should not be interpreted as expected final project costs. All conditions require loans to be fully repayable by Guernsey Electricity from revenues with no residual costs to the States of Guernsey, subject to States' Trading Supervisory Board approval of the business case, with Policy & Resources Committee retaining discretion to approve or decline funding.

The ten-year capital investment programme includes business as usual investments in replacement and renewal of aging generators, life extension where cost-efficient, replacement of network assets, transmission infrastructure and control systems, replacement of the Channel Islands Electricity Grid Normandie 2 interconnector, and property, fleet and IT investment. Electricity Strategy-related investments include next generation meters for demand management, bulk supply points for increased imports, renewable generation and battery storage development, and tank farm development for alternative fuels.

## Q&A

**Q: How much would the second interconnector cost and when would it be operational?**  
A: The preferred Guernsey-Jersey 2 route would cost an estimated £113 million and be commissioned by 2030\. The alternative Guernsey-France 1 route would cost £209 million and not be commissioned until 2034\. Both figures are within maximum funding envelopes that include contingency provisions.

**Q: How much would electricity bills increase under the proposals?**  
A: For households on the Super Economy 12 non-heating tariff currently paying £1,689 annually, bills would rise to £2,542 by 2036 under the Guernsey-Jersey route (an £853 increase) and to £2,669 under the France route (a £980 increase). However, over the full 30-year period to 2054, all options show average annual increases below the assumed 3% inflation rate.

**Q: Why does Guernsey need a second interconnector?**  
A: The island currently relies on a single interconnector for 92% of its electricity, creating a single point of failure that caused outages in 2012 and 2018\. Additionally, the on-island generation fleet at Vale Power Station is aging significantly, with the oldest generators having served over 50 years by 2030\. A second cable would improve security of supply, allow maintenance without loss of import capacity, and enable reduction in costly on-island thermal generation.