UK drops mega-project to transport energy underwater from Morocco

The National

6 hours ago

The UK has decided to abandon a mega-project intended to bring solar and wind energy from Morocco for use by domestic consumers.
It stepped back from a plan to transmit power generated in Tan-tan province in Morocco's south through what would have been the world's longest underwater power cable and is pivoting to other projects seen as less risky, British energy officials said.
The British government, which is aiming to largely decarbonise its electricity sector by 2030, said it would no longer support the £25 billion ($33 billion) scheme due to a 'high level of inherent risk, related to both delivery and security".
It said it believed domestic projects could offer better economic benefits.
"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," energy department minister Michael Shanks said in a written statement to parliament.
He added the project did not clearly align strategically with the government's mission to create home-grown power in the UK.
The project had originally been designated by the previous Conservative government as being of "national significance" but faced funding and regulatory hurdles.
The Morocco-UK Power Project was announced by British company Xlinks in 2021 as part of a drive to create a global energy grid and ship power from places where it is cheap to produce to high-demand markets. Xlinks said the scheme would provide an equivalent of 8 per cent of Britain's current electricity needs, or about seven million homes.
According to Xlinks, the project would have lowered wholesale electricity prices by 9 per cent and reduced the UK sector's carbon emissions by about 10 per cent.
'There are stronger alternative options that we should focus our attention on," Mr Shanks said, noting the inherent risk for taxpayers and consumers.
The UK relies heavily on natural gas for its energy needs and aims to generate all of its energy from renewable sources by 2030. It closed its last coal-fired power plant last year and offered some financing to a string of wind, solar and energy storage projects to help meet its goal.
Such large-scale infrastructure projects typically rely on some government support or fixed prices per megawatt-hour. Xlinks had sought government backing with a 25-year contract guaranteeing a fixed price for the electricity, and has already received loans from investors including France's Total Energies and development bank Africa Finance Corporation.
Xlinks board chairman, former Tesco chief executive Dave Lewis, said the company would continue pursuing the project despite the government's decision.
'We are hugely surprised and bitterly disappointed," he said, noting the company believed its project would offer electricity at cheaper rates and more quickly than other proposals, including to expand nuclear power.
'Over £100 million from leading energy sector players has already been spent on project development and demand from lenders to participate in the construction phase is greater than we require," he said.
"We are now working to unlock the potential of the project and maximise its value for all parties in a different way."
The Xlinks scheme is one of several projects that reflect how European countries are looking to North Africa for clean energy, testing whether it is cheaper to generate renewable power in ideal conditions far away and ship it, or to produce it domestically.
The project would transmit electricity through nearly 4,000km of underwater cables encased in protective plastic and steel, with minimal transmission loss. If completed, it would be the world's largest interconnector, though smaller subsea cable networks already link the UK to neighbouring European countries.
In addition, transmission projects in Tunisia and Egypt aim to link solar and wind farms to Italy and Greece.
Britain is one of the leading players in renewable energy in Europe due to onshore and offshore wind power but still trails behind Scandinavian countries, which draw a large part of their electricity from wind and hydroelectric dams.
The UK has set a target to reduce its greenhouse gas emissions by at least 81 per cent by 2035 compared to 1990 levels and is aiming to be carbon neutral by 2050.
The government recently pledged more than £30 billion to relaunch nuclear power as an essential step for energy security and its climate ambitions.