XLCC
XLCC Limited is a start-up company incorporated in 2020. They plan to construct a 2 million square foot high voltage direct current cable manufacturing facility. These HVDC cables will enable the transfer of power over long distances between renewable energy sources and consumers , and are vital to realising ScotWind and our net zero ambitions.
XLCC are in discussions with another company called Xlinks to be their first “pathfinder” customer, which will sign up for four years of full production from the facility. Xlinks is itself a highly ambitious start-up company that aims to supply 8% of the UK’s domestic electricity requirements (3.6 gigawatts ) from a proposed solar and wind farm in Morocco, which will provide a stable baseload of power. Due to existing capacity constraints in the HVDC market, Xlinks requires a new manufacturing facility to achieve this – which is why it’s essential that XLCC is operational to supply Xlinks’s needs.
Given the significant scale of the market opportunity, XLCC is seeking international investment of more than £1 billion to scale their production to meet this demand.
XLCC Hunterston factory site
Supply and Demand of HVDC
Demand for high voltage direct current (HVDC) cables will see significant growth by 2027, especially within the EU and UK. This demand will be principally driven by offshore wind and interconnectors, with over 5,500 kilometres of HVDC cable required for offshore projects in the UK.
HVDC supply is forecast to fall below demand this decade, with €63 billion of unmet demand before 2030 (excluding the demand for the Xlinks project).
Currently there is an order backlog of more than €19 billion, as existing manufacturers are unable to meet the demand.
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Demand for HVDC cable will see significant growth by 2027
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Hunterston design and construction plans already in advanced stages
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Discussions ongoing with potential operating partners
Project details
The project benefits from two-year exclusivity on a 70-acre site in Hunterston, North Ayrshire, with access to a deepwater port. The proposal has full planning permission and is ready to break ground on the 180-metre tower development, with the main factory design also well advanced.
From 2027, XLCC will produce certified 525 kilovolt HVDC cables from three vertical continuous vulcanization (VCV) lines, with the ability to expand to six lines with minimal disruption of production.
The project is also working on a world-leading cable laying vessel (CLV) design, and the shipyard tender is complete. The CLV will be the world’s largest at 201 metres long, with capacity for 110 crew and 26,000 tonnes of cable. XLCC is also looking at eco-friendly options to fuel the boat, with both hybrid fuel and hydrogen being options. The vessel will be finished by 2027.
Investment opportunity
XLCC is looking to fundraise separately for the factory and CLV.
For the factory, XLCC is currently seeking industrial partner investors for a development fundraising round of £50 million. They aim to secure up to five industrial partners, which will help demonstrate tangible demand for the product.
These partners will have priority access to cables at discounted rates once the factory is commissioned. In addition to supplying cable for their own projects, their investment will also help bring additional capacity to the market.
The development fundraising will quickly be followed by a construction fundraising round of £1 billion, plus contingency. This round will fund the completion of the first three VCV lines, and will also help develop the infrastructure to ensure that the remaining three VCV lines can be installed without disrupting factory production.
There is potential for both equity and debt investment in the CLV.
A 3D image of XLCC's Cable Laying Vessel
Alignment to the United Nation’s Sustainable Development Goals
The Green Investment Portfolio support the UN’s Sustainable Development Goals. The projects in the portfolio support the goals below:
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Disclaimer
Whereas every effort has been made to ensure that the information in these pages is accurate, Scottish Enterprise and Scottish Development International does not accept any liability for errors, omissions or misleading statements. And no warranty is given, or responsibility accepted as to the standing of any individual, firm, company or other organisation mentioned. Investors will need to undertake their own due diligence in conjunction with individual project promoters/sponsors in relation to the detailed project investment opportunities presented.