The UK government has decided not to proceed with formal negotiations on the £25bn Xlinks project, a proposed renewable energy link between Morocco and Britain as it shifts focus toward boosting domestic clean energy production.

Sky News reports that Energy Security and Net Zero Secretary Ed Miliband will confirm the move in a ministerial statement expected later on Thursday. The decision comes despite Xlinks’ promise to supply up to 10% of the UK’s electricity through a 4,000-kilometre undersea cable and deliver power at a cost significantly below that of new nuclear plants.

Chaired by former Tesco chief executive Sir Dave Lewis, Xlinks had been seeking a 25-year contract for difference with the government to guarantee pricing, without requiring taxpayer funding. The company claimed its hybrid wind and solar model could help stabilise the UK’s power grid and lower industrial energy costs.

A Whitehall insider indicated the decision was influenced by a desire to prioritise "homegrown" energy, though some industry voices questioned this rationale.

Sir Dave previously said that without UK support, Xlinks would explore opportunities elsewhere. The company, backed by Total and with over £100m raised in development funding, is now expected to pivot towards other markets.

Xlinks had projected electricity delivery at £70–£80 per megawatt hour, substantially less than Sizewell C nuclear plant, which received over £14bn in government support earlier this month.

In earlier remarks, Sir Dave emphasised the strategic value of the Morocco-UK link:

“The Moroccan government has recognised that exporting green [energy] is a very important part of their economic plan going forward, so they have an export strategy,” he said at the time.
“The Sahara Desert is probably one of the best places in the world to generate renewable energy from... And if you're capturing that energy and adding some battery storage, you can generate energy to cover a little bit more than 20 hours a day, which makes it a fantastic partner for the UK.”

He also emphasised the technological readiness of the project:

“The benefit here is that it's proven technology with a very committed reliable partner with a cost profile... that we will never [be able to] match in the UK.”