EKF, now a part of Denmark’s Export and Investment Fund, participates in the financing of a new electricity link between Denmark and the UK, which will transport electricity equivalent to the electricity consumption of 1.4 million households. The electricity link will allow a more effective usage of renewable energy, access to sustainable electricity generation, and improved security of electricity supply.
Viking Link is the name of the 765 km long electricity interconnector between Denmark and the UK which EKF has co-financed together with BNP Paribas and several other export credit agencies. The new interconnector between the British and the Danish transmission systems connects Revsing substation in southern Jutland, Denmark with Bicker Fen substation in Lincolnshire in the UK. The interconnector has a capacity of 1.400 MW high voltage direct current (HVDC).
“This is a really exciting project, especially now when security of supply is more important than earlier”, says Thomas Hovard, CCO in EKF.
The project involves the establishment of transformer stations and converter stations in each country. Furthermore, submarine cables and onshore underground cables will be established between the two converter stations. All onshore cables and submarine cables of the interconnector are buried underground, consequently, there will not be any cables connected by towers.
The Viking Link project has been developed by the Danish system operator Energinet and the British National Grid each holding a 50/50 share.
The facility is structured by BNP Paribas.
“Following the successful closing of the SACE / Euler Hermes-covered Viking Link Green Loans to National Grid in 2020, we are proud to have brought additional funding to the project by structuring and arranging the EKF-covered Green Loan Facility. Jointly with another Nordic ECA also closed in 2022, the EKF Loan completes the suit of cost-efficient solutions devised by BNP Paribas and the ECAs in support of this cross-border infrastructure, more strategic than ever for European energy transition, in light of the unprecedented challenges which our continent is facing,” says Yasser Henda, Global Head of Export Finance at BNP.
In Denmark, Viking Link will increase the value of wind power as the interconnector provides better opportunities for cross-border electricity trading, hereby extending the market for Danish wind energy.
Furthermore, the interconnector will also contribute to lowering the whole sale prices on electricity in the UK. The interconnector is thus a socio-economic benefit to both Denmark and the UK.
Moreover, the project has been included in the European Union´s prioritized PCI-list of important infrastructure projects which contribute to the interconnection of the European electricity network, i.e., the so-called “Projects of Common Interest”.
The interconnector consists of the following main components:
The North Sea
625 km high voltage direct current (HVDC) submarine cables between the UK and Denmark. The submarine cables will be buried in the seabed.
Onshore underground high voltage DC cables (HVDC) (75 km) from the west coast of Denmark to the existing 400 kV substation Revsing near Vejen in Jutland, Denmark.
Converter station in Revsing converting electricity between DC and AC.
New equipment for the existing 400 kV station in Revsing.
Onshore underground high voltage DC cables (HVDC) (65 km) from the British coast to a converter station.
Converter station converting electricity between DC and AC.
Onshore underground high voltage AC cables (HVAC) from the converter station to the National Grid´s existing transformer station in Bicker Fen in Lincolnshire.
New equipment for the existing transformer station.
The total value of the project is EUR 1.6 billion, but only the National Grid´s share of the project is being financed.
The facility is as mentioned structured by BNP Paribas as the Lead Arranger with the participation of several European export credit agencies, including SACE from Italy, Euler Hermes from Germany, EKN and SEK from Sweden, and EKF. The facility is classified as a Green Loan in accordance with international principles.
A number of Danish exporters are involved as suppliers to the Viking Link project.
Construction work on the project is progressing as planned and is expected to be completed during 2023 with final tests and commissioning taking place in December 2023.