The European Investment Bank, Europe’s long-term lending institution, has agreed to provide GBP 250 million for investment over two years by Northern Powergrid to upgrade electricity distribution infrastructure and reinforce the electricity network to enable a smarter electricity network for 3.9 million homes and businesses in the North East, Yorkshire and northern Lincolnshire.
Tom Fielden, Northern Powergrid’s Finance Director, said: “We have an ambitious GBP 3 billion, eight-year investment programme to upgrade the region’s power network; improve reliability for our customers; support economic growth; and meet future low-carbon challenges. Securing competitive finance helps us deliver the best long-term value for our customers and this agreement is an important milestone in our business plan.”
“Investment in UK energy infrastructure is essential to upgrade equipment, ensure supply and expand innovative services. The European Investment Bank recognises the importance of ambitious investment being carried out by regional power companies and is pleased to provide a loan of GBP 250 million to support Northern Powergrid’s wider investment programme through one of our largest ever loans for energy distribution in the United Kingdom.” said Jonathan Taylor, European Investment Bank Vice-President.
The long-term loan from the European Investment Bank will be used by Northern Powergrid’s owned distribution network operating companies Northern Powergrid (Yorkshire) plc and Northern Powergrid (Northeast) Ltd to reinforce the regional power network so there are fewer and shorter power cuts, provide additional capacity for future customers and protect our network from severe weather.
The new EIB loan will support Northern Powergrid’s GBP 3 billion, eight-year investment programme and includes improving connections to 900MW of renewable energy resources, such as onshore and offshore windfarms and solar power schemes, and the undergrounding of 100km of overhead power lines in protected landscape areas.
Use of new technology supported by the investment scheme will allow greater electricity capacity to be added to the network without adding as many new cables or transformers as would traditionally be needed, and new smartgrid technology will reduce the need for more expensive network reinforcement.
Northern Powergrid is one of the largest companies in the region and directly employs over 2,200 people. The company manages the electricity distribution network, including more than 60,000 substations and 91,000km of overhead power lines and underground cables, which provides power to 8 million customers in the North East, Yorkshire and northern Lincolnshire.
Over the last decade the European Investment Bank has provided more than GBP 10 billion for investment in the UK energy sector, including renewable energy schemes, national transmission networks and regional power distribution, and interconnectors to Ireland and continental Europe.
The European Investment Bank is the world’s largest international public bank and 15% owned by the UK government. Lending by the European Investment Bank last year totalled GBP 5.6 billion and supported long-term investment in 40 projects across the country. This represented the largest annual engagement since the start of EIB lending in the UK in 1973 and supported nearly GBP 16 billion of overall investment.