The Dogger Bank C transmission asset will be used to help stabilise voltage on the UK grid after the expected closure of Hartlepool nuclear power station in March 2024.
The asset is one of two chosen by National Grid ESO as part of the Pennines Voltage Pathfinder, which compares market-based solutions against transmission owner solutions.
It is part of plans to introduce greater competition onto the network.
The Dogger Bank C transmission asset and National Grid Electricity Transmission (NGET) will between them provide 700 MVAr of reactive power capability in the north-east of England and West Yorkshire regions between 2024 and 2034.
This will save consumers millions of pounds, National Grid ESO said.
The Voltage Pathfinder identified two areas where reactive power solutions would be needed in the years ahead and introduced competition to ensure the most cost-effective services were selected.
In the West Yorkshire area, the Pathfinder process found that the counterfactual submitted by NGET was the most economic option for the ESO to manage voltage in the best interests of consumers.
NGET’s delivery of shunt reactors at high voltage substations, will provide a reactive power service following the closure of other power stations in the area.
National Grid ESO head of networks Julian Leslie said: “These services take us another step closer to 100% zero carbon operation, showcasing Britain’s innovation in engineering and driving competition within the system, ultimately saving consumers millions of pounds.
“Reactive power capability is vital for managing voltage and being able to operate a zero carbon system of the future so we’re excited to see that an offshore wind farm’s transmission asset will deliver reactive power to support the wider network for the first time in Britain.”
NGET director of network strategy and operations Lydia Ogilvie said: “As agreed with the ESO and Ofgem we cannot bid into the pathfinder process in the way other market participants can.
“Our agreed role for this pathfinder has been to provide a baseline to enable the ESO to compare the economic benefits of a fixed-term contract to a long-term regulated asset solution.
“The analysis undertaken by ESO in this instance suggests that there is an economic case for NGET to develop 500 MVAr reactive capability in West Yorkshire.
“We will work with ESO and Ofgem to further understand the results and the consumer savings outlined and progress with the required projects to deliver the best outcomes for consumers.”
SSE Renewables project director for Dogger Bank Steve Wilson said: “Dogger Bank is continually pushing the boundaries of what can be achieved through the delivery of an offshore wind farm, breaking records and setting new milestones here in the UK and globally.
“Today’s announcement that Dogger Bank C will become the first UK offshore wind farm to use the functionality of its transmission assets to support National Grid ESO in balancing the network at the lowest cost is further proof of the outstanding innovation that our Dogger Bank team continually strives to deliver.
“It also demonstrates the significant positive impact that offshore wind energy, and Dogger Bank in particular, is having on delivering the UK’s net zero carbon electricity system while driving down long-term energy costs for British consumers.”