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Thursday, 17 November 2022

Good news for Morocco’s Xlinks project, possibly bad news for the UK

Morocco’s Xlinks scores new investment: German energy consultancy Conenergy is investing an undisclosed sum in the USD 18 bn Morocco-UK Xlinks solar and wind energy project under a “financial and strategic partnership,” the firm said in a statement.

Who are the investors already on board? Xlinks — whose board members include Acwa Power’s CEO Paddy Padmanathan — had in May raised an investment of undisclosed size from UK-based energy supplier Octopus Energy Group, in addition to securing commitments from undisclosed development finance institutions.

REFRESHER- The Xlinks renewable energy project in Morocco is set to generate 10.5 GW of solar and wind energy from just one project and on-site battery storage by 2030. Some 3.6 GW of electricity should be making its way to the UK through four sub-sea cables stretching 3.8k km — potentially the world’s longest undersea electric cable connection. When completed, it is expected to supply 8% of the UK’s electricity needs.

But the UK’s “slow” negotiations could push Morocco to divert the energy elsewhere. In an interview with The Times, Xlinks Executive Chairman Sir Dave Lewis said that talks with the UK government on the project are “frustratingly slow” and that the energy could end up going elsewhere if the country does not commit to details soon.

The best case scenario for Xlinks: The project could be completed by 2030 if the UK delivers an assurance next year that consumers will pay a fixed price of GBP 48 per MWh for the power delivered, Lewis said.

Morocco is casting a wider net: The country signed an agreement with the EU to establish a “green partnership” that would see cooperation and “investment in green technology, renewable energy production, sustainable mobility, and clean production in industry.” It also recently signed an MoU with France, Portugal, Spain and Germany to facilitate cross-border renewable corporate power purchase agreements and financial and technical cooperation.

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