Funding agreed to secure £350 million inward investment project
23 Feb 2024 • 4 minute read
Find out about Sumitomo Electrical Industries’ upcoming investment in the north of Scotland.
A funding package has been agreed to secure an estimated £350 million inward investment project for Scotland from Sumitomo Electric UK Power Cables Ltd (SEUK), a subsidiary of Japanese company Sumitomo Electric Industries Ltd (SEI).
In May 2023, SEI announced plans to develop a power cable factory in the Scottish Highlands, which would supply high voltage cables to the growing offshore wind energy sector in the area.
Now the Scottish Government, along with Highlands and Islands Enterprise (HIE) and Scottish Enterprise, have approved up to £24.5 million in public sector support to secure the project. This comprises £19.37 million in Scottish Government funding, £4.6 million from HIE and £530,000 from Scottish Enterprise.
About the project
With offshore wind developments like ScotWind increasing in Scotland and the UK, the market demand for high voltage cables has rapidly increased. The market reports there are currently extended lead times for cable supply which, in turn, slow the development of offshore wind projects.
SEUK’s new factory will help reduce those lead times while also strengthening energy security.
The £25.4 million in funding will support the project as it begins to invest in its plant and equipment, construction of a new purpose-built factory, and long-term land leasing and associated costs.
Economic benefits for Scotland and the UK
This project will stimulate significant economic activity across industry supply chains at regional, Scottish and UK levels. This includes the creation of around 330 jobs in Scotland over the next 10 years, 265 of which will be in the Highlands and Islands, including 156 well-paid manufacturing jobs on site.
On 17 January, the Highland Council approved a planning application from SEUK for a 57,500 square meter factory on a 15-hectare site close to the Port of Nigg yard in Easter Ross. Offices, a warehouse, and external laydown areas are included in the proposals.
The site is located within the recently designated Inverness and Cromarty Firth Green Freeport boundary, which was a key factor in the company’s decision to invest in the Highlands.
How we’ve supported Sumitomo
While Scottish Enterprise provided investment, Scottish Development International has been working with Sumitomo for a number of years to showcase Scotland’s leadership in renewable energy.
Our colleagues in Japan have developed a relationship with Sumitomo over a significant period of time, highlighting why Scotland would be an ideal location for this proposed facility. Alongside our partners, we will continue to work with the company as it further develops its plans for this innovative project.
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Helping companies capitalise on low carbon opportunities
Highlands and Islands Enterprise Chief Executive Stewart Black has said that “The new factory will play an important part in our transition to a net zero economy, enabling more enterprises and communities to capitalise on opportunities around low carbon and adding to the region’s growing reputation as an excellent location for business and inward investment.
“The Inverness and Cromarty Firth Green Freeport has played a significant part in attracting Sumitomo to the region. It’s been a great example of the strength of the local partnership and what this can achieve. I’m delighted we have got to this stage and look forward to continuing to work with Sumitomo and our partners to establish the new factory.”
Adrian Gillespie, Chief Executive at Scottish Enterprise, noted that “Sumitomo’s decision to locate in Scotland is good news, both for the Highlands region and because it adds another critical capability to Scotland’s supply chain offering in offshore wind.
“Scottish Enterprise’s new approach to working with companies includes our energy transition mission, which aims to accelerate technology innovation, supply chain capability and investment in manufacturing and key infrastructure. Sumitomo is a great example of this process in action and, alongside our Team Scotland partners, we’ll continue to work closely with the company as it expands its operations here.”
About Sumitomo Electrical Industries
Sumitomo was founded in 1897 in Osaka, Japan, and has since grown its business operations into several major industries, including electronics, industrial materials, and energy
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