The European Investment Bank (EIB) has agreed to lend £500 million ($721 million; €636 million) to help finance a key plank of Scotland’s renewable energy programme.
The proceeds will go towards improving transmission between wind, wave and tidal schemes and the national grid. The project includes a new 1.2GW subsea cable between Spittal in Caithness and Blackhillock in Moray, in addition to associated onshore infrastructure works.
The long-term loan is part of a £1.2 billion investment plan slated by Scottish Hydro Electric Transmission, a wholly-owned subsidiary of UK-listed utility SSE, aimed at boosting the power transmission network it operates in the region.
The loan’s first tranche, which totals £300 million, was signed this week. The remainder is expected to be agreed on next year as the scheme progresses, the EIB said in a statement.
“This project represents the largest investment in [the] electricity network in the north of Scotland since the hydro development era of the 1950s,” commented David Gardner, director of Scottish Hydro Electric Transmission.
He lauded the scheme for “delivering value for money while reinforcing the network, allowing for the connection of new generation and providing a more resilient power supply to those who live and work in the area”.
It is expected that the new transmission link will supply enough power to meet the needs of about two million Scottish residents once operational.