The UK Department for Energy Security and Net Zero (DESNZ) has said that it will not grant a CfD to a submarine cable project that UK developer Xlinks plans to build to connect a 10.5 GW wind-solar facility in Morocco to locations in Wales and England. The DESNZ had originally planned to award a 25-year CfD to the project.
“The government has concluded that it is not in the UK national interest at this time to continue further consideration of support for the Morocco-UK Power Project,” said the DESNZ. “The government also believes that domestic alternatives can see greater economic benefits whether that be through jobs or supply chains.”
Xlinks said it was “hugely” surprised and “bitterly” disappointed by the government's decision.
“The project requires no upfront government investment and offered a highly competitive CfD strike price,” Xlinks Chairman Dave Lewis said in a statement. “It would reduce wholesale electricity prices by over 9% in its first year; bring in GBP20 billion of socio-economic value, including a GBP 5 billion ($6.9 billion) injection into the UK’s green industries; provide 8% of the UK’s electricity needs at a time when demand is rocketing; cut power sector CO2 emissions by c.10% in its first year; and increase energy security through increased diversity of supply and reduced reliance on imported gas.”
Xlinks said it will not abandon the project, which already saw around GBP 100 million being spent for its development. “Demand from lenders to participate in the construction phase is greater than we require,” said Lewis, without providing additional details.
In May 2022, UK investment firm Octopus Energy signed an agreement with Xlinks to develop the huge facility. It was planned to include 7 GW of solar, 3.5 GW of wind, and 5 GW/20 GWh of battery storage capacity in Morocco.
The wind-solar complex was designed to connect to the UK power network at Alverdiscott, Devon, and Pembroke via a 3,800 km high-voltage direct current (HVDC) transmission line. The developer said the project would use four separate cables, making it the longest subsea power transmission link in the world.
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