Private Capital Steps In Where Governments Hesitate

In a deal that signals a new era for European infrastructure finance, U.S. asset management titan Apollo Global Management is set to provide a £4.5 billion ($6 billion) loan package to Hinkley Point C, the long-delayed UK nuclear project owned by France’s EDF. The agreement stands as one of the largest private credit transactions ever made for a project of such national strategic importance in the United Kingdom. It arrives at a critical juncture for the UK’s energy transition, as political uncertainty, regulatory hurdles, and the retreat of Chinese capital have left the future of large-scale nuclear generation hanging in the balance. Apollo’s move is both a response to new opportunities in European infrastructure and a reflection of private markets’ growing willingness—and ability—to fund megaprojects once dominated by governments and big banks.

Quantitative Overview – Big Numbers Behind Big Ambitions

The Hinkley Point C nuclear power station is no ordinary project. With an estimated final cost exceeding £40 billion, it is by far the largest infrastructure investment in the UK in recent decades. When both reactors come online, now expected in 2029 after multiple delays, Hinkley Point C is slated to supply low-carbon electricity to approximately six million British homes, significantly advancing the country’s climate goals and energy security. The loan from Apollo, totaling £4.5 billion ($6 billion), will inject urgently needed liquidity into the project, helping EDF—France’s state-owned utility and the majority stakeholder—cover ballooning construction costs after Chinese co-owner CGN halted its funding in late 2023.

EDF’s financial burden has been significant. Fitch Ratings recently noted that EDF injects equity on a monthly basis to keep the UK subgroup solvent, with its British subsidiary carrying €6.7 billion in debt as of March 2025. The Apollo financing package, reportedly priced below 7% interest, is investment-grade—testament to both the project’s importance and the growing sophistication of the private credit industry. While the loan is technically unsecured and not directly tied to the nuclear facility itself, the capital is expected to be channeled toward the completion of Hinkley Point C.

The Changing Landscape – Private Credit Replaces Risk-Averse Banks

The rise of private credit is one of the most important trends in global finance since the 2008 financial crisis. Traditional banks, weighed down by regulatory constraints and balance sheet conservatism, have stepped back from lending to large, risky, or politically sensitive projects. In their place, asset managers like Apollo, Blackstone, and others have raised vast pools of capital from pension funds, insurance companies, and sovereign wealth funds, which are eager for long-duration, stable returns. By 2024, the private credit market had swelled to $1.5 trillion, according to Morgan Stanley—a figure projected to rise further as infrastructure, energy, and real estate opportunities multiply across Europe.

The Hinkley Point C loan is emblematic of this shift. Where once a project of this scale would have been financed primarily by government bonds or syndicated bank loans, today’s financing model is multi-sourced, blending public funds, project equity, and now, increasingly, private debt. Apollo’s willingness to commit such a large sum—at a rate considered attractive given current market conditions—reflects both confidence in the underlying project and a broader belief in the long-term value of European infrastructure investments.

Strategic and Geopolitical Context – A Nuclear Pivot Amid Rising Risks

Hinkley Point C’s history is a saga of ambition, setbacks, and shifting alliances. The project, the first new nuclear power station to be built in Britain in nearly 30 years, has suffered from repeated delays, cost overruns, and controversy. Its original budget has more than doubled, with Brexit, inflation, supply chain bottlenecks, and regulatory scrutiny all playing a part. Most dramatically, the withdrawal of China General Nuclear Power Corp (CGN)—amid growing UK government concerns over Chinese involvement in critical infrastructure—left EDF facing the prospect of shouldering the entire financial load.

The new funding from Apollo is thus more than just a loan—it is a vote of confidence in the UK’s ability to complete Hinkley Point C and, more broadly, in the country’s commitment to nuclear energy as a cornerstone of its net-zero ambitions. While nuclear projects remain controversial in much of Europe, the current UK government has pledged to push ahead with new plants, viewing them as essential for energy security and carbon reduction.

Yet the geopolitical dimensions are never far from the surface. The CGN pullout underscored the risks of depending on foreign state capital for critical infrastructure, particularly as tensions rise between China and the West. Apollo’s intervention is not just a commercial decision—it is a strategic move that aligns Western private capital with the UK’s national interests.

Market Implications – Infrastructure as an Asset Class for the Next Decade

Apollo’s bet on Hinkley Point C is a signal to global investors: European infrastructure, especially energy and transport, is open for business. As governments across the continent seek to modernize grids, build data centers, and decarbonize the energy mix, the need for long-duration capital will only grow. Apollo President Jim Zelter recently projected the firm could invest $100 billion “in the ground” in Germany over the next decade—a sign of how large private managers view Europe’s coming infrastructure boom.

The deal also underscores the increasing competitiveness of private credit. As Marc Scheipe, CEO at Allvue, told CNBC, the Hinkley Point C transaction demonstrates how private credit has matured into a primary funding source for large-scale infrastructure, a realm traditionally dominated by public markets. With competition intensifying, private credit managers are now seeking out undervalued European assets, aiming for both yield and diversification.

For the UK, the successful completion of Hinkley Point C could become a template for future projects—from new nuclear to high-speed rail, green hydrogen, and beyond. For EDF, the deal provides not only funding but also the flexibility to manage balance sheet risk and operational complexity in a challenging market.

Risks and Challenges – The Realities of Private Financing

Despite the optimism, the path forward is not without risk. The nuclear sector is notorious for construction delays, cost inflation, regulatory surprises, and public opposition. Private lenders like Apollo, though sophisticated, are not immune to the political and financial shocks that can buffet long-term infrastructure projects. Moreover, with the debt being unsecured, there is an added layer of risk should construction face further setbacks.

There are also broader policy questions: does reliance on private debt for essential infrastructure shift too much risk to the private sector, or does it incentivize discipline and innovation? How will the returns Apollo seeks affect consumer electricity prices or long-term public oversight? As infrastructure financing becomes more complex, governments and investors alike will need to balance efficiency, affordability, and resilience.

Comparative Perspective – The New Playbook for European Projects

The Hinkley Point C financing deal is likely to inspire similar arrangements across Europe. With many countries pursuing ambitious green energy targets, the need for capital far outstrips what governments alone can provide. Private credit’s ascendancy brings both opportunity and new challenges, as the line between public purpose and private profit is redrawn.

For the US-based Apollo, this deal is also a strategic bridgehead—positioning the firm to shape the next generation of European infrastructure. It exemplifies how global capital flows are being redirected toward energy security, decarbonization, and the renewal of aging assets.

Conclusion – Private Credit at the Heart of Europe’s Future

Apollo’s £4.5 billion loan to Hinkley Point C is more than a financing arrangement—it is a harbinger of the private credit industry’s central role in shaping the next era of European infrastructure. As public markets retreat from risk and governments face mounting fiscal pressures, private capital is stepping into the breach, bringing discipline, innovation, and global expertise. For the UK, the deal marks a pivotal step in ensuring a reliable, low-carbon future. For Europe, it signals that the infrastructure revolution will be powered not just by public ambition, but by private investment on an unprecedented scale.