EIB and ČEZ Partner on €400 Million Loan to Enhance Czech Energy Infrastructure and Green Transition

EIB and ČEZ Partner on €400 Million Loan to Enhance Czech Energy Infrastructure and Green Transition

(IN BRIEF) The European Investment Bank (EIB) is lending €400 million to Czech energy provider ČEZ to modernize and expand the country’s electricity distribution grid, enabling the integration of up to 5.5 gigawatts of renewable energy. The project, aligned with the EU’s REPowerEU strategy, aims to enhance energy independence, improve power reliability, and support the green transition. Scheduled for completion by 2026, this initiative follows a €790 million loan in 2022, with EIB’s total funding for ČEZ reaching nearly €2.8 billion to advance sustainable energy infrastructure in the Czech Republic.

(PRESS RELEASE) LUXEMBOURG, 2-Dec-2024 — /EuropaWire/ — The European Investment Bank (EIB) has approved a €400 million loan to ČEZ, the Czech Republic’s leading energy provider, to modernize and expand the nation’s electricity distribution grid. This funding aims to bolster the integration of renewable energy sources, improve power reliability for businesses and households, and strengthen the country’s energy independence.

ČEZ plans to utilize the loan to refurbish its distribution networks, introduce advanced remotely controlled energy systems, and develop infrastructure capable of accommodating up to 5.5 gigawatts of new renewable energy from sources like wind and solar. These efforts align with the European Union’s REPowerEU strategy to reduce reliance on Russian fossil fuels and expedite the green energy transition.

EIB Vice-President Kyriacos Kakouris emphasized the significance of this collaboration, stating, “This investment modernizes the Czech Republic’s electricity grid while accelerating renewable energy integration. It highlights our shared commitment to energy resilience and sustainable growth.”

ČEZ Chief Financial Officer Martin Novák underscored the company’s dedication to modernization and decarbonization, noting, “Our investments are transforming the electricity distribution landscape, introducing cutting-edge technologies, and meeting the growing demand for faster, more efficient energy solutions.”

The modernization projects funded by this loan are expected to be completed by 2026. This new financing builds on a €790 million EIB loan granted to ČEZ in 2022, bringing EIB’s total funding for ČEZ to nearly €2.8 billion. These investments reflect EIB’s strategic focus on climate action, energy efficiency, and fostering economic and social cohesion across Europe.

Background information

About REPowerEU  

The loan to ČEZ furthers the objectives of the European Commission’s REPowerEU plan, created in response to the hardships and global energy market disruption caused by Russia’s war of aggression. The plan aims to save and produce clean energy, diversify energy supplies, and is backed by financial and legal means to build the new energy infrastructure that Europe needs. REPowerEU sets out a series of measures to rapidly reduce dependence on Russian fossil fuels, fast-forward the green transition, and increase energy system resilience EU-wide. These measures include finding alternative energy supplies, making behavioural changes to save energy, and spurring investment in renewable energy.

In 2022, the European Commission introduced the REPowerEU plan to accelerate the green transition. In 2023, the Bank’s investments in this plan rose to €21 billion. The EIB Group will provide €45 billion in additional support to the REPowerEU plan over five years by financing businesses and public authorities working on clean energy projects. This includes financing EU manufacturing in strategic net-zero technologies and the extraction, processing, and recycling of critical raw materials. The funding will be fully deployed by 2027, and it is expected to mobilise more than €150 billion in investment for targeted sectors.

Over the past decade, the European Investment Bank (EIB) Group has channelled around €108 billion into the European Union’s energy sector and additional finance for clean energy projects around the world. These investments are now helping Europe switch to clean energy sources and sharply reduce its reliance on Russian gas.

The European Investment Bank (EIB)

The European Investment Bank (EIB) is the long-term lending institution of the European Union owned by its Member States. It makes long-term finance available for sound investment in order to contribute towards EU policy goals. The EIB supports projects that make a significant impact on economic growth, innovation, and job creation. It is also one of the largest providers of climate finance, supporting projects that contribute to environmental sustainability and the fight against climate change.

ČEZ

ČEZ is one of the biggest companies in the Czech Republic and a leader in European energy utilities, operating in Western and Central Europe. ČEZ is committed to setting an example and making the energy sector sustainable, greener and friendlier to our planet. It strives for more diversity, for closer cooperation with communities and to always offer the best technological and energy-saving solutions to the customers. The ČEZ strategy — Clean Energy of Tomorrow — aims to significantly increase the number of renewable energy sources in the company’s portfolio, as well as among its customers. ČEZ aims to be climate-neutral by 2040.

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SOURCE: European Investment Bank