ScottishPower receives £600m National Wealth Fund funding for Eastern Green Link 4

ScottishPower has received £600 million in funding from the National Wealth Fund to support the development of a major subsea electricity link designed to strengthen the UK’s energy security and accelerate the transition to clean energy.

The funding will go towards Eastern Green Link 4 (EGL4), a 2GW high-voltage direct current (HVDC) line running between Fife in Scotland and Norfolk in England. About 530 kilometers long, the project will be able to transmit enough electricity to power about 1.5 million homes.

EGL4 is part of a new generation of long-distance, bidirectional subsea infrastructure aimed at modernizing the UK’s electricity grid. By allowing renewable energy produced in Scotland, particularly wind power, to be efficiently transported to high-demand facilities in England, the link is expected to reduce grid congestion and reduce so-called “blockage costs”, where excess energy is wasted or curtailed.

The project also aims to reduce dependence on imported fossil fuels, which are always vulnerable to global price shocks and political instability.

Energy Minister Michael Shanks said such grid development is essential to stabilizing electricity costs and increasing the benefits of generating clean domestic electricity.

“Investment in the grid is essential to weaning Britain off fuel prices,” he said, adding that projects such as EGL4 would also support job creation and regional economic growth.

The funding builds on a £600m loan provided by the National Wealth Fund by 2025 to support ScottishPower’s portfolio of network projects, highlighting the ongoing relationship between government-backed capital and private sector investment.

Chancellor Rachel Reeves said the agreement demonstrates the fund’s role in supporting national strategic infrastructure.

“That is exactly why we created the National Wealth Fund, to put the full force of government behind strategic investment to secure Britain’s future,” he said.

Oliver Holbourn, chief executive of the fund, added that funding projects such as EGL4 is vital to ensuring the UK’s energy system is “fit for the future”.

The project is part of a wider expansion of electricity networks needed to meet the UK’s clean energy ambitions. According to the National Energy System Operator, around £58 billion of investment will be needed across Great Britain by 2035 to deliver a fully passive energy system.

ScottishPower’s parent company, Iberdrola, has committed to investing £12 billion in UK transmission and distribution networks by 2028 as part of its wider electrification strategy.

Keith Anderson, chief executive of ScottishPower, said the new funding will help speed up the delivery of critical infrastructure in line with the government’s Clean Power 2030 goals.

Apart from energy security, the project is expected to bring extensive economic benefits. ScottishPower has revealed it will increase its workforce, particularly in central and southern Scotland, to support network development and construction work.

Douglas Alexander said the investment shows a commitment to “jumpstarting economic growth” while strengthening national infrastructure.

The EGL4 project emphasizes a wider shift in UK energy policy towards large-scale electrification and grid modernisation, recognizing that renewable generation alone is insufficient without infrastructure for efficient distribution.

As the demand for electricity increases – driven by the electrification of transport, heating and industry, the ability to transmit power to all regions will become more critical.

By combining government funding with private sector delivery, the government aims to accelerate deployment while ensuring that projects of national importance can continue despite the level of investment required.

In the UK, projects like EGL4 represent more than infrastructure development, they are the basis for building a resilient, self-sufficient and low-carbon energy system that can withstand future global shocks.