In a surprising pivot, the UK government has withdrawn its support for the ambitious $34.4 billion Morocco-UK Power Project, a groundbreaking renewable energy initiative that aimed to deliver solar and wind power from Morocco’s Sahara Desert to the UK via a 3,800 km subsea cable. This decision, announced on June 26, 2025, marks a significant shift in the UK’s energy strategy, raising questions about costs, consumer impacts, and the feasibility of replacing this lost capacity with domestic alternatives.
The Morocco-UK Power Project: A Bold Vision
The Morocco-UK Power Project, spearheaded by Xlinks, was set to be a global first in transcontinental energy trade. The plan involved constructing a 3.6 GW solar-and-wind complex in Morocco, connected to Devon, UK, through the world’s longest high-voltage direct current (HVDC) subsea cable. The project promised to supply clean energy to up to seven million UK homes, meeting approximately 8% of the country’s electricity demand at a cost potentially half that of new nuclear power stations.
With over $137 million already invested by major energy players like GE Vernova, TotalEnergies, and Abu Dhabi National Energy Co., the project was designated as a “nationally significant” initiative by the previous Conservative government. Xlinks sought a contract for difference (CfD), a guaranteed minimum price for electricity, to secure financing. However, the UK government, led by Energy Security and Net Zero Secretary Ed Miliband, has now deemed the project too risky and misaligned with its focus on “homegrown” energy.
Why the UK Pulled the Plug
Energy Minister Michael Shanks cited a “high level of inherent risk, related to both delivery and security” as the primary reason for abandoning the project. The 4,000 km cable, over five times the length of the UK’s current longest subsea connection to Denmark, raised concerns about technical feasibility and energy security. Critics also questioned the regulatory oversight of a power system routed through Morocco, a non-European market.
Shanks emphasized that the UK’s revised energy security strategy prioritizes domestic renewables with “greater economic and grid-integration value.” This aligns with Miliband’s broader vision of reducing reliance on volatile fossil fuel markets through investments in local wind, solar, nuclear, and small modular reactors (SMRs). The government’s new industrial strategy includes plans to invest over $40.84 billion annually by 2035 in such areas, signaling a clear preference for UK-based solutions.
Costs of Cancellation: Immediate and Long-Term
The decision to scrap the project carries significant financial implications. Xlinks has already spent over $137 million on development, with no clear path to recoup these costs unless alternative financing is secured. Xlinks Chair Dave Lewis, former Tesco CEO, expressed disappointment, noting that the project could have lowered the UK’s wholesale electricity prices, among the highest in Europe. He confirmed that Xlinks is now exploring private funding to revive the initiative, but the loss of government backing poses a major hurdle.
For UK consumers, the cancellation could lead to higher electricity costs in the near term. The Morocco-UK project was projected to deliver power at a lower cost than new nuclear plants, which require investments like the $19 billion earmarked for Sizewell C. Without this renewable import, the UK must accelerate domestic projects to fill the 3.6 GW gap, potentially increasing reliance on more expensive or less reliable energy sources during the transition.
Backup Costs: Replacing the Lost Capacity
Replacing the 3.6 GW of clean energy from Morocco will require substantial investment in domestic alternatives. Here’s a breakdown of potential backup options and their costs:
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Onshore and Offshore Wind: The UK is a global leader in offshore wind, with projects like Dogger Bank delivering reliable capacity. However, scaling up to replace 3.6 GW could cost $3–$5 billion per GW for offshore wind, totaling $10.8–$18 billion. Onshore wind, while cheaper at $1–$2 billion per GW, faces planning and community resistance, potentially delaying deployment.
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Solar Power: Domestic solar farms are less expensive, with costs around $0.8–$1.2 billion per GW. To match 3.6 GW, the UK would need to invest approximately $2.9–$4.3 billion. However, solar’s intermittent nature requires additional storage solutions, adding $300–$500 million per GW for battery systems.
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Nuclear and SMRs: The government’s commitment to nuclear includes $19 billion for a single large-scale plant like Sizewell C (3.2 GW) and $3.4 billion for SMR development. While nuclear offers stable baseload power, its high cost and long construction timelines (10–15 years) make it a less immediate solution compared to the Morocco project’s proposed 2029 start.
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Grid and Storage Upgrades: Integrating new renewable capacity requires grid enhancements, estimated at $1–$2 billion annually for the UK to meet net-zero goals. Battery storage to balance intermittent renewables could add another $1–$2 billion for 3.6 GW of equivalent capacity.
In total, replacing the Morocco project’s capacity with domestic renewables and storage could cost $15–$25 billion, potentially exceeding the $34.4 billion project cost when factoring in grid upgrades and delays. These expenses may translate to higher energy bills, as utilities pass on development costs to consumers.
Consumer Impacts: Higher Bills and Energy Security
The UK’s decision to prioritize domestic energy could bolster long-term energy security but risks short-term price hikes. Wholesale electricity prices, already elevated due to global gas market volatility, may rise further if domestic projects lag. The International Energy Agency (IEA) notes that global clean energy spending hit $3.3 trillion in 2025, yet supply chain constraints and permitting delays could hinder rapid deployment.
For households, this could mean an increase of 5–10% in electricity bills over the next 5–10 years, depending on the pace of new capacity additions. The Morocco project’s promise of 9% price reductions is now off the table, and reliance on fossil fuel backups during transition periods could further drive costs.
A Setback for Global Renewable Ambitions?
The cancellation is a blow to innovative cross-border energy solutions. The Morocco-UK project was a flagship for global renewable integration, showcasing how regions with abundant solar and wind could supply energy-deficient markets. Its collapse may deter similar ventures, despite advancements in HVDC technology that minimize transmission losses over long distances.
Xlinks remains optimistic, with Lewis asserting that demand from private lenders exceeds requirements. However, without UK government support, the project’s future is uncertain, potentially shifting focus to other markets or scaled-down proposals.
Looking Ahead
The UK’s withdrawal from the Morocco-UK Power Project reflects a strategic bet on domestic energy but comes with steep costs and risks. Consumers may face higher bills as the government races to replace 3.6 GW of clean energy with homegrown alternatives, estimated to cost $15–$25 billion or more. While Miliband’s vision of a self-reliant, net-zero UK is ambitious, the decision underscores the challenges of balancing innovation, security, and affordability in the global energy transition.
Until Ed Miliband understands that “Renewable” wind and solar are intermittent, and need an additional standby power source, the irrefutable increase in costs to consumers will continue . Grid and energy security start at home, not through grid interconnects. Wind and solar have their place, but not as central power systems yet. I would welcome the opportunity to talk with anyone in the UK on my podcast about one single wind or solar farm that has end-of-life land reclamation built into the energy costs. I am willing to bet my Tesla that there is not one.
For now, the dream of a Sahara-to-Devon power link is on hold, but its legacy may yet inspire future efforts to connect the world’s renewable resources. Stay tuned to Energy News Beat for updates on this evolving story.
Sources: OilPrice.com, Reuters, Bloomberg, Sky News, Morocco World News
