The Swedish Export Credit Corporation (SEK) has finalised a €800m loan agreement with National Grid Electricity Transmission to support the Eastern Green Link 2 (EGL2) project.
The high-voltage direct current (HVDC) subsea transmission initiative aims to connect Scotland and England, forming part of the UK Government’s Net Zero strategy to decarbonise the electricity network.
EGL2, a collaborative effort between National Grid Electricity Transmission and SSEN Transmission, involves a 505km subsea cable linking Peterhead in Aberdeenshire to Drax in North Yorkshire.
The 2GW HVDC cable will facilitate power transfer between Scotland and England, capable of supplying electricity to two million homes upon completion.
SEK’s financing supports Swedish and European exports to National Grid’s portion of the project, including contributions from Hitachi Energy.
The loan has been designated as a Green Loan, aligning with international standards for climate benefits and global sustainability objectives. The total estimated cost of EGL2 is around €5bn.
The financing arrangement involves collaboration with Société Générale and BNP Paribas, with SEK providing funds backed by EKN’s Green Export Credit Guarantee.
SEK global trade and export finance director Marica Bixo said: “This is a strategically important investment that strengthens the UK’s renewable energy infrastructure. We are proud to contribute by financing Swedish technology with global impact.
“Green and sustainable financing is a priority area for us, and this project clearly supports the transition to a low-carbon economy.”
In February 2024, Prysmian Group, a provider of cable solutions, secured a €1.9bn contract for the Eastern Green Link 2 (EGL2) project.
Under the agreement, the Italian firm will supply an HVDC cable system for the electricity transmission initiative. The contract encompasses the design, manufacture, installation, testing, and commissioning of the necessary HVDC cable system.
Construction of EGL2 commenced following Ofgem’s final approval in August 2024, with the project expected to be operational by 2029.
