UK Infrastructure Bank sets aside £87m to invest in subsea cable factory
The UK Infrastructure Bank (UKIB) has put aside £87m to invest in the development of a new subsea cable factory in the Scottish town of Hunterston.
The funding will be given to XLCC, an Essex-based cable manufacturer. UKIB, the state-owned development bank, has pledged an initial injection of £20m, with a further £67m contingent on XLCC hitting certain milestones.
The project is expected to create around 900 permanent jobs and more than 200 apprenticeships upon completion, with the facility producing thousands of km of high-voltage cables each year.
“Industry projections indicate that demand for subsea cables will soon exceed existing supply chain capacity,” John Flint, the UK Infrastructure Bank’s chief executive, said.
“Our support for XLCC is intended to provide confidence to the market, crowding private investment into this sector to boost production capacity in an industry set to have a significant impact on the UK‘s transition to net zero.”
XLCC boss Ian Douglas said: “The creation of the Hunterston facility in Scotland brings significant investment to the UK, creating highly skilled jobs in advanced manufacturing and project management for decades to come.”
It comes as the the government and energy regulator Ofgem look to fast-track a number of electricity transmission projects in a bid to speed up delivery of the UK’s offshore wind supply.
Ofgem gave the green light in August to the £3.4bn Eastern Green Link Two, a subsea cable between Yorkshire and North-East Scotland, dubbed as an “electricity superhighway.”
“Britain is seeing the biggest transformation of the energy grid for decades. It will have long-term benefits for us all – true energy security, cutting emissions and protecting consumers,” Ofgem chief executive Jonathan Brearley said.
“It demands unprecedented levels of public-private investment in clean power, so we welcome the UKIB’s commitment today to green industry, jobs and growth.”