How Sun Cable could be a loser, yet a winner

“What this will do, on its own, will really move the needle, a whole new industry will kickstart.”

He said the eventual laying of more inter-regional cables, such as Xlinks’ and Sun Cable’s AAPowerLink connecting the Northern Territory and Singapore, would change the face of the transition to renewables.

“Once you start sharing power between regions, and you operate a global grid in the same way as you have a more local grid, bingo: that just solves so much of the issue that we face,” he said. “I think this long-distance energy transfer will solve the whole intermittency of renewables.”

His shiny optimism could reflect on Sun Cable’s $40 billion plan. Even though the two projects are apple-and-orange in their geographies and practicalities, Xlinks’ progress seems to suggest there is a viable commercial route to building long, international undersea energy cables.

Mr Morrish says Europe, at least, will eventually work out that hydrogen – with its electrolysers, compression, transport, storage and fuel cells or turbines – simply cannot deliver electricity as efficiently as cables.

“Effectively, if you do it through hydrogen, your round-trip efficiency for hydrogen is less than 30 per cent. Ours is 85 per cent,” he said. “We’re about three times more efficient than hydrogen in terms of converting back into electrons, at about similar a capex. So we’re a third of the cost of hydrogen.”

Xlinks was founded in 2019, a year after Sun Cable. But it has several advantages: its route lies in shallower waters; it added wind to its solar farm because the two are highly complementary in Morocco; and it began with a different cable configuration.

It did not have deep-pocketed billionaires like Mr Cannon-Brookes and Fortescue boss Andrew Forrest behind it. But its backers include TotalEnergies, the Abu Dhabi national energy company, and British disrupter Octopus Energy, which is part-owned by Australia’s Origin Energy.

Mr Morrish said he wanted to see the Australian project – which is now in the midst of subsea mapping, regulatory approvals, customer negotiations and investor discussions – get up and running.

“We’re trying to build an incredibly ambitious project, which while the individual components themselves are not technically difficult, actually putting them all together, that is the complexity and the challenge,” he said. “Unselfishly, the more the merrier.”

Mr Morrish said Xlinks had lined up about 70 per cent of the £8 billion of equity it would need for the construction phase. And although many renewables projects were struggling to procure the kit they needed to build out solar farms, he was confident on this score.

“We were slightly nervous before we started it in terms of how many players would be stepping up, able to and wanting to do this. We’re now very comfortable that we’re there on all the different procurement packages,” he said.

“We’ve got multiple competition from multiple vendors, and all confident that this can be produced in the timeframes that we’re looking for. So actually, we’re in a good place on that.”

AAPowerLink, having come through the fracas between Mr Cannon-Brookes and Dr Forrest last year, is looking to solve some of those challenges in-house. Last November, it said it would build a plant in Tasmania to make advanced high-voltage subsea cables, to overcome the problem that all other potential suppliers are in the Northern Hemisphere.