The retail giant partners with EDF and Quinbrook Infrastructure Partners to secure 65% of power from Cleve Hill Solar Park, marking a significant step towards its carbon neutrality goals.
Tesco, the UK’s largest retailer, has signed the country’s largest corporate solar power purchase agreement (PPA) to date, securing 65% of the electricity generated from the Cleve Hill Solar Park in Kent. This landmark deal, in partnership with EDF and Quinbrook Infrastructure Partners, is set to provide up to 10% of Tesco’s UK electricity demand over 15 years.
The Cleve Hill Solar Park, located in Faversham, Kent, is the largest solar and battery storage project ever constructed in the UK. With a 373 megawatts (MW) capacity, the site will feature more than 560,000 solar panels and energy storage infrastructure. Construction began in early 2023, with operations expected to commence in early 2025.
Ken Murphy, Tesco Group’s chief executive, emphasised the significance of this agreement in the company’s sustainability journey: “We’re delighted to be announcing such a significant step in our journey towards carbon neutrality across our operations by 2035.” Cleve Hill solar park, with its ability to generate up to 10% of our UK electricity demand, joins several other PPAs Teco have announced over the last five years.”
The deal significantly boosts Tesco’s renewable energy portfolio and aligns with the UK’s broader clean energy and net-zero goals. Cleve Hill Solar Park is classified as a Nationally Significant Infrastructure Project (NSIP), underscoring its importance to the national energy strategy.
This PPA forms part of Tesco’s ongoing commitment to sourcing renewable energy. Over the past five years, the retailer has launched multiple energy projects, enabling it to directly source green electricity from wind farms and solar parks across the UK. With the addition of Cleve Hill to its existing portfolio, PPAs will cover 45% of Tesco UK’s electricity demand or 36% of the Group’s expected demand by 2030.
The agreement also highlights the growing trend of corporate PPAs in the UK. A recent PwC survey of 750 UK organisations found that nearly one-third of businesses are taking action in response to increasing energy costs, including reviewing energy procurement strategies, improving energy efficiency, and adopting corporate power purchase agreements.
EDF’s role in the deal extends beyond power supply. The company will provide power balancing and shaping services to ensure the agreement’s smooth implementation. This collaborative approach demonstrates the complexity and sophistication of modern renewable energy deals in the corporate sector.
The Cleve Hill project is particularly notable for its scale and its inclusion of energy storage infrastructure. Murphy highlighted this aspect, stating, “With its ability to provide vital energy storage infrastructure, it’s a key part of the renewable energy strategy in the UK, and further evidence of our commitment to tackling climate change and source green electricity from innovative projects like this.”
The global context of this deal is significant. According to the International Energy Agency, approximately three-quarters of the world’s newly added renewable energy capacity in 2023 was attributed to solar power. At the same time, corporate funding for the solar sector surged by 42% year-on-year, as reported by Mercom Capital Group.
In the UK specifically, more than 14.4 gigawatts (GW) of solar capacity has been installed cumulatively, with one-third coming from rooftop solar. This highlights the growing importance of solar energy in the country’s renewable energy mix.
Tesco’s commitment to renewable energy is part of a broader sustainability strategy that includes achieving net-zero emissions in its operations by 2035 and across its entire value chain by 2050. The Cleve Hill PPA represents a significant milestone in this journey, demonstrating the potential for large corporations to drive the transition to renewable energy.
As the renewable energy sector continues to grow and evolve, deals like this between Tesco and Cleve Hill Solar Park are likely to become more common. They represent a win-win situation, providing businesses with long-term energy security and price stability while supporting the development of crucial renewable energy infrastructure.
This landmark agreement sets a new benchmark for corporate renewable energy procurement in the UK. It is a model for other large businesses looking to reduce their carbon footprint and support the transition to a low-carbon economy.
