French giant signs up to help Icelandic lava power British homes

A multibillion pound project aimed at using the power generated by Icelandic volcanoes to fuel British households has lined up a major French infrastructure investor to back its development.

Sky News has learnt that Meridiam, a global asset manager helping to fund the expansion of New York's La Guardia Airport, has agreed to write a multimillion pound cheque to finance part of the development cost of a new 1,000-mile-long pipeline between Iceland and the UK.

The venture, Atlantic SuperConnection, is the brainchild of Edi Truell, a major Conservative Party donor and Boris Johnson's former pensions adviser.

Chinese, Canadian, Middle Eastern and Singaporean pension funds and sovereign wealth funds have approached Mr Truell's investment vehicle, Disruptive Capital, about contributing to the estimated £3.5bn cost of the pipeline.

Its development costs are estimated to be around £30m.

Mr Truell has been working on the project since early 2014, and gained support from David Cameron, who commissioned a working group to study its feasibility during his tenure as Prime Minister.

He now wants to persuade Mr Cameron's successor to back the initiative, which would involve electricity being imported via a cable under the Atlantic seabed, and which he claims would be generated far more cheaply than power from the planned Hinkley Point nuclear power station in Somerset.

Meridiam's prospective involvement in the new power generator would make it far from the only French influence over Britain's energy mix.

Hinkley Point is being partly funded by EDF (Paris: FR0010242511 - news) , the vast French state-owned utility which also owns one of Britain's big six domestic gas and electricity suppliers.

The Atlantic SuperConnection would use geothermal and hydroelectric power generated by Icelandic volcanoes and hot springs to supply electricity to hundreds of thousands - and potentially millions - of UK households.

Mr Truell also wants to build a factory in the northeast of England to manufacture the copper or aluminium cable that would be used for the pipeline, a move that would create a substantial number of jobs.

Under the financier's plans, the Atlantic SuperConnection could begin supplying power to British homes before the end of 2022.