ScottishPower secures £600 million National Wealth Fund green financing

EGL4 is a new 2 GW high voltage direct current (HVDC) subsea power link that will help reduce constraint costs by transporting domestically-produced energy from where it is generated in Scotland to areas of demand in England. Running between Fife and Norfolk, the 530 km high-voltage cable will be able to transmit enough electricity to power the equivalent of 1.5 million UK homes.

Long-distance, bidirectional subsea infrastructure projects such as EGL4 are essential to reinforce the UK’s energy security and lower the cost of electricity for homes and businesses by reducing dependence on imported fossil fuels that are exposed to volatile international markets.

This transaction builds on the National Wealth Fund’s £600 million loan in May 2025 to support the development of seven of ScottishPower’s priority network initiatives. The ongoing collaboration between ScottishPower and the National Wealth Fund to drive investment in the UK grid demonstrates the power of the public and private sector joining forces to support the transition to lower cost, homegrown, clean energy.

The National Wealth Fund prioritised the grid as an area for investment in its recent strategic plan and as a public finance institution is able to offer greater flexibility, with a longer tenor facility to allow ScottishPower to better align the debt profile with the life of the assets being financed. With the National Energy System Operator (NESO) estimating that £58 billion will be required in Great Britain by 2035 to support the delivery of the clean power system, the National Wealth Fund also has a role to play in widening the pools of capital available to the sector.

This new financing enables the Iberdrola Group to continue advancing its ambitious plan to develop distribution and transmission networks in the UK, which involves CAPEX investments of £12 billion (€14 billion) through 2028 to continue expanding electrification and responding to the expected increase in electricity demand.

Chancellor, Rachel Reeves, noted: “This is exactly why we created the National Wealth Fund – to put the full power of government behind strategic investment in partnership with business that secures Britain’s future. This investment will build the energy infrastructure of tomorrow, strengthen our energy security, and help bring down bills. We have the right economic plan for Britain – built on stability, investment, and reform – with an active, strategic state helping to build a stronger, more secure economy and make working people better off in every part of Britain.”

Oliver Holbourn, CEO of the National Wealth Fund, commented: “By supporting nationally significant projects like EGL4, we are demonstrating our commitment to strengthening our national infrastructure to help ensure our energy system is fit for the future. Our financing will support ScottishPower to go further and faster to deliver crucial grid upgrades and in doing so unlock clean energy for homes and businesses across the country.”

Keith Anderson, CEO of ScottishPower, added: “We are pleased to be strengthening our relationship with the National Wealth Fund to deliver these critical investments. By working together to support the delivery of the Government’s Clean Power 2030 pathway, projects like EGL4 are meeting our shared goals of accelerating electrification, boosting the UK economy, and delivering energy security.”

Energy Minister, Michael Shanks, highlighted: “Grid upgrades are vital to getting Britain off the rollercoaster of fossil fuel prices allowing us to make the most of the low-cost clean energy we generate. Network investment is delivering growth across the country jobs too, with ScottishPower set to double its transmission workforce in central and southern Scotland, creating opportunities for good, well-paid careers.”

Scottish Secretary, Douglas Alexander, concluded: “This major investment by the UK Government’s National Wealth Fund demonstrates our commitment to essential grid infrastructure like this subsea power link. Through investments like this one, we are helping to kickstart economic growth and delivering on our commitment to a decade of national renewal.”

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