Octopus Energy Group(Octopus) is backing Xlinks’ plans to build the world’s largest subsea power cable to deliver renewable energy from Morocco to the UK.
Xlinks wants to construct four 3,800km-long subsea cables to connect a huge renewable energy farm in the Moroccan desert with Devon in South West England.
The site will provide wind and solar power, supplying 3.6 GW of reliable, clean energy to the UK for an average of 20 hours a day, enough to power about 7m heat pumps all year round.
Once up and running, Xlinks is expected to deliver power at £48/MWh, a comparable rate to offshore wind.
Currently, the project is in the development phase, and is undertaking economic, environmental and archaeological impact assessments.
It is scheduled to become operational in 2027.
The latest announcement follows reports last month from Sky News that Xlinks was looking for a backers, with the overall cost of the project estimated at £16bn.
The amount of money Octopus is putting forward remains undisclosed, but City A.M. understands the figure is a seven-figure sum,
The investment marks the beginning of a strategic partnership between both companies, with further investments under discussion.
Both companies are also exploring potential off-taking rights for Octopus.
Morocco is looking to position itself as a world leader in solar energy, and already meets two-fifths of its electricity demand with renewables with some of the world’s largest solar farms.
The partnership also comes after the British government unveiled its energy security strategy last month, which called for a massive ramp up in renewable generation, including boosting solar power generation from 14 GW to 70 GW to reduce its reliance on Russian fossil fuel imports.
Greg Jackson, founder of Octopus, personally invested in the project a number of years ago.
Commenting on the partnership he said: “Layering different sources of green energy helps answer the question ‘what do we do when the wind’s not blowing’. This project is magic because it’s all proven technology – on a huge and ambitious scale. The renewables revolution has not just begun, it’s now accelerating at an unprecedented pace for the good of people and the planet.”
Simon Morrish, chief executive of Xlinks, says: “This partnership presents an enormous opportunity to bring down energy bills significantly and help the UK achieve Net Zero.”
“The investment demonstrates the ambition of both Xlinks and Octopus to deliver a cheaper, greener future for the UK public.”