CashNews.co
The British government has approved a major battery storage facility in the UK, which is backed by a joint venture involving US investment giant Blackrock and KX Power, a UK-registered asset manager with ties to Chinese investors.
The UK launched a national security review of the proposed 80-megawatt project, led by former Chinese diplomat Zhe Zhang, but has decided to approve the plans, with only minor conditions attached.
Cabinet minister Pat McFadden approved the deal last week with stipulations that KX Power must notify the government of any changes to the power buyer and adhere to strict data-sharing protocols.
A public notice on the government’s website said: “The Chancellor of the Duchy of Lancaster considers that these measures mitigate any risks to national security in relation to: the security of a future United Kingdom electricity asset; and preventing disruption of services provided to the [grid].”
Blackrock, which announced plans to invest up to £200m in the joint venture in 2022, is financing the project. Once operational, the facility is poised to become one of the largest of its kind in the UK, increasing the nation’s renewable energy storage capacity.
The approval, however, comes amid fraying UK-China relations. Several Chinese investments have been clocked under the National Security and Investment Act 2021, such as the sale of Newport Wafer Fab, a semiconductor company, to Chinese-owned Nexperia.
The act, which enables the UK government to scrutinise and potentially veto business takeovers, was recently reviewed under the Conservative government.
Foreign Secretary David Lammy has said he is keen to patch up diplomatic relations and is reportedly mulling a visit to China.
KX Power did not immediately respond to a request for comment. Blackrock did not comment.
A Cabinet Office spokesman said: “Following a detailed national security assessment, the Chancellor of the Duchy of Lancaster has allowed the proposed acquisition of control of an 80-megawatt battery energy storage system by KXP Immingham Limited, through the granting of an Ofgem electricity generation licence to proceed, subject to necessary and proportionate measures to address national security concerns.”