The Hornsea Two development follows the completion of the Hornsea One wind farm project off the Yorkshire coast
(Picture: Hornsea One project)International investors have struck deals worth £7 billion for UK’s energy infrastructure, as the government gears up to announce its energy security strategy.
Danish energy company Ørsted has sold a 50% stake in its proposed Hornsea 2 wind farm development to French finance businesses Crédit Agricole and Axa in a £3 billion deal.
The Hornsea 2 project will see the development of one of the world’s largest offshore wind farms off the Yorkshire coast, generating enough electricity to power 1.3 million homes.
It follows the 2020 completion of the nearby Hornsea One wind farm, the largest offshore wind farm in the world with power to supply over a million homes.
In a separate deal, National Grid sold a 60% stake in its UK gas transmission business to a consortium of investors in Australia and North America, led by Australian bank Macquarie. The buyers have the option to buy the remaining 40% of the business at a later day.
National Grid will receive £2.2 billion in cash, as well as a further £2 billion from debt financing. National Grid said the combined £4.2 billion proceeds from the deal will be used to pay off debts relating to the financing of its 2021 acquisition of WPD, the UK’s largest electricity distribution business, as the company seeks to move away from its gas operations and focus on renewables. It plans to invest £35 billion in energy infrastructure over the next 5 years.
CEO John Pettigrew said: “This transaction further enhances our role in delivering the UK’s energy transition, pivots our portfolio towards electricity, whilst ensuring the security of the energy supply for the country.”
The announcements come as the publication of the government’s energy security strategy faces delays amid reports of divisions between Boris Johnson and Chancellor Rishi Sunak over levels of funding committed to green energy projects.
Earlier in March, Boris Johnson signalled an ambition to ramp up the use of nuclear energy to reach 25% of the UK’s energy supply by 2050. Under the government’s current plans, offshore wind will power every UK home by 2030.
Comment: As Energy Security Strategy gets stuck in purgatory, overseas investors buy up British power
