The developers of the GBP-2.4-billion (USD 2.87bn/EUR 2.82bn) NeuConnect interconnector between England and Germany today announced that the project has achieved financial close and is expected to begin early works later this year.
The project is led by France-based infrastructure investor Meridiam, Allianz Capital Partners and Kansai Electric Power Co Inc (TYO:9503) of Japan. With a length of 725 km and a transmission capacity of up to 1.4 GW, NeuConnect represents the first direct link between the UK and German energy markets and is the single-largest Anglo-German infrastructure project.
The project vehicle, called NeuConnect Britain Ltd, has drawn substantial interest from the international financial community and has achieved today’s milestone with a consortium of over 20 national and international banks and financial institutions. One of them, the European Investment Bank (EIB), said separately that its contribution will cover up to EUR 400 million (USD 408m) of the total cost estimated at EUR 2.8 billion.
The plan is to build two new substations – one on the Isle of Grain in Kent, England and another in the Wilhelmshaven region in Lower Saxonia, northern Germany. They will be connected by subsea cables travelling through British, Dutch and German waters. Major construction to lay subsea cables and build substations is seen to start next year, while completion is scheduled for 2028.
The EIB noted that NeuConnect will improve the utilisation of offshore wind capacities on the coasts according to the respective local wind strength and thus support EU and German renewable energy policies.
“Both countries Germany and the United Kingdom aim to accelerate their energy transition and to boost energy security. As a champion in offshore wind the UK is a crucial partner for us as we work towards our common goals. NeuConnect will allow our energy grids to share excess power – making sure renewable energy is not wasted,” said Miguel Berger, German Ambassador to the UK.
According to independent analysis, the project will create more than GBP 1.7 billion in UK consumer benefits and a net reduction in carbon emissions of more than 13 MtCO2 over 25 years as it will help integrate more renewable energy sources in the two countries.
In April, NeuConnect awarded GBP 1.5 billion in major contracts for the project, including selecting Italy’s Prysmian SpA to design, manufacture, install, test and commission the interconnector, and Siemens Energy AG to design and build the converter stations.
(GBP 1 = USD 1.197/EUR 1.174)
(EUR 1 = USD 1.020)
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Image Credits: Meridiam.
