Apollo Just Dropped £4.5bn on Hinkley Point—Here’s Why It’s a Big Deal
So Apollo Global Management went all in—£4.5 billion, to be exact—on the Hinkley Point C nuclear plant. That’s one of the biggest private credit deals the UK’s ever seen. On one hand, it’s a massive vote of confidence in the country’s energy future. But let’s be real: it also makes you wonder who’s really footing the bill when private money gets involved in stuff like this.
Hinkley Point C: The Basics (And Why It Matters)
Okay, quick rundown. Hinkley Point C, down in Somerset, is supposed to be the UK’s first new nuclear plant in what feels like forever. We’re talking 3.2 gigawatts—enough juice for six million homes. That’s the whole point, right? Replace those ancient coal plants and hit net-zero by 2050. EDF, the French energy giant, started building it back in 2016. But here’s the thing: it’s 2024, and they’re still saying it won’t be done until 2029. Classic.
Apollo’s Play: High Risk, High Reward?
Here’s how Apollo’s deal works. They’re lending the cash to EDF as private credit—basically a fancy loan with double-digit returns. And they’ve got it secured against the plant’s future earnings. Smart move? Maybe. Nuclear’s stable long-term, and big investors love that these days. “This isn’t just about the money,” some insider told me. “It’s about being part of the energy shift.” Sure, but let’s not pretend the money doesn’t matter.
Why the UK Needs This (Like, Yesterday)
Let me put it this way: North Sea gas isn’t what it used to be, and renewables aren’t always reliable. Hinkley could cover 7% of the UK’s electricity—that’s huge. But here’s the kicker: Apollo jumping in changes the game. Private credit usually runs from nuclear like it’s on fire. Now? Other firms might actually follow. “When Apollo moves, people notice,” one analyst said. No kidding.
Not Everyone’s Celebrating, Though
Yeah, about that. Costs have gone from £18bn to over £32bn—and guess who’s paying part of that? Yep, regular folks through higher energy bills. Then there’s the nuclear waste problem (still not solved) and that insane £92.50/MWh strike price. Three times the going rate? “It’s basically gambling with public money,” a Green Party rep said. Harsh, but not wrong.
What’s Next for UK Nuclear?
Despite all the drama, the government’s full steam ahead. They’re already planning two more reactors at Sizewell C, calling nuclear the “backbone” of their green plans. And Apollo’s deal might just tempt other big players—Blackstone and KKR are apparently sniffing around. But here’s the reality check: nuclear isn’t a quick win. We’re talking decades before anyone sees a return. If they ever do.
The Bottom Line
Apollo’s cash keeps Hinkley alive, but the bigger story is what it means. For the UK, it’s a step toward not relying on sketchy energy imports. For private credit? Proof that even the scariest projects can get funded—if the price is right. As those reactor domes creep up in Somerset, one thing’s clear: this nuclear rollercoaster’s nowhere near done.
Source: Financial Times – Companies
