World’s Biggest Battery Secures Financing for UK Construction
(Bloomberg) -- The world’s biggest battery project secured about £750 million ($1 billion) in public and private financing, and will begin construction immediately in northern England, marking a significant step forward in the UK’s transition to renewable energy.
The 1.4-gigawatt system is being built by Edinburgh-based Fidra Energy with backing from the National Wealth Fund and institutional investor EIG, according to a joint statement released Wednesday. The Thorpe Marsh project is located in South Yorkshire, which is UK Energy Secretary Ed Miliband’s constituency, and potentially could supply more than 785,000 homes.
The announcement comes at a pivotal time as the UK adds record amounts of wind and solar capacity but needs more ways to store it. Gas generators are the primary way the country keeps the lights on when the weather isn’t cooperating, so battery projects will help change that as the energy sector tries to reach 2030 climate goals.
“Every battery we build boosts Britain’s energy security,” Miliband said in the statement.
Fidra Energy signed long-term offtake agreements with Electricite de France SA, Octopus Energy Ltd. and Statkraft AS for about 80% of the Thorpe Marsh project’s capacity. The site is set to be operational in mid-2027.
This is the world’s largest project by power output that has secured financing, according to BloombergNEF.
The funding includes £594 million in loan facilities from a consortium of international lenders, including ABN Amro Bank NV and China Minsheng Banking Corp Ltd.
EIG and the government-owned National Wealth Fund injected £445 million into Fidra Energy for this project and future developments, according to the statement.
Planning approvals and grid connections are major issues faced by battery developers. This specific site had a connection date in 2027, meaning it was protected from the ongoing overhaul of the waiting line for grid hookups, Fidra Energy Chief Executive Officer Chris Elder said.
Because the project is located on a former coal plant site, many of the typical planning hurdles were easier to overcome.
Fidra Energy is moving forward with another 500-megawatt battery project in Nottinghamshire. When completed, these two sites would represent 11% of the additional storage capacity needed to achieve the government’s 2030 goals.
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