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BayernLB and 20 other banks are together financing the NeuConnect project. The privately funded EUR 2.8 billion interconnector, whose construction is scheduled to begin before the end of 2022, will link Europe’s two biggest energy markets: the UK and Germany. The cables will run from the planned Isle of Grain substation in Kent County, England, to the Fedderwarden substation located in the German coastal town of Wilhelmshaven – traversing the territorial waters of Great Britain, the Netherlands and Germany.
The 725 km high-voltage direct-current transmission line will create an “invisible energy highway” capable of transporting up to 1.4 GW of electricity in both directions – enough power to supply as many as 1.5 million households.
The project will produce one of the largest interconnectors in the world. NeuConnect is scheduled to go into operation by 2028, from which point on it will help to sustain Europe’s energy supply.
“We’re excited to be a part of one of the biggest-ever German-British infrastructure projects and all that it symbolises. The energy crisis is laying bare how important it is for us to be energy independent and, most important, energy secure – both today and in the future”, says Sebastian Schenk, who heads BayernLB’s Network operators & energy providers sector.
The energy security will also come with a significant reduction in CO2 emissions and a lighter path towards the net-zero targets. This is because the renewable energy feed-ins in Germany and the UK can, according to an analysis conducted under the project, stave off upwards of a net 13 million metric tonnes of CO2 over a period of 25 years. In recognition of the project’s environmental goals and commitment to a sustainable development, NeuConnect’s financing has been certified by Moody’s ESG Solutions as compliant with the four core components of the Loan Market Association’s (LMA) Green Loan Principles of 2021.
NeuConnect Britain Ltd was established in 2018. In the five short years since, it has advanced to the financial close and become one of the world's largest interconnector projects. It is led by global investors Meridiam, Allianz Capital Partners and Kansai Electric Power.
Sergio Rodriguez Casado of Meridiam had this to say: “The conclusion of the financing agreements in July marks the pivot, after five years, to the implementation phase of this unique, innovative project. We are proud that we will be contributing significantly not only to the success of the energy transition but – as a sustainable project that underscores yet again the cohesion in Europe, regardless of its borders – also to the energy security of millions of people.”