Siemens Energy, Prysmian bag GBP 1.5bn of contracts for UK-German interconnector

The first interconnector between Germany and the UK, meant to enable the exchange of 1.4 GW of power in both directions, is taking shape as contractors have been selected to perform the cabling and converter station works on the project.

Siemens Energy AG (ETR:ENR) has been awarded an order to build two high-voltage direct current (HVDC) converter stations in the UK and Germany while Prysmian SpA (BIT:PRY) has been contracted to design, manufacture, install, test and commission the 725 km (450.5 mi) interconnector. The two contracts are worth about GBP 1.5 billion (USD 1.95bn/EUR 1.79bn).

The financial close on the project is expected to be reached in the coming weeks. Works on the power link should start later this year.

The first direct power connection between the UK and Germany should ensure a flexible and secure electricity supply and help avoid the waste of green energy as wind turbines in Germany must be regularly curtailed due to grid bottlenecks in order to avoid overload or a blackout. The new interconnector will solve this problem and transport the excess electricity in either direction.

“The electricity connection between Germany and Great Britain represents the increasing integration of the European electricity market. Efficient and cross-border electricity connections unite the countries in their efforts to decarbonize. They are the perfect example that we can only achieve the energy transition together,” said Siemens Energy board member Tim Holt.

The plan for the interconnector between two of Europe’s largest energy markets was unveiled last year and is supported by the EU.

The consortium behind the mega project is led by Meridiam, Allianz Capital Partners and Kansai Electric Power.

(GBP 1 = USD 1.302/EUR 1.195)

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