EIB and Terna Seal €500 Million Deal for Tyrrhenian Link Renewable Energy Project

EIB and Terna Seal €500 Million Deal for Tyrrhenian Link Renewable Energy Project

(IN BRIEF) During the EIB Forum in Luxembourg, the European Investment Bank (EIB) and Terna signed a €500 million financing contract, marking the final tranche of the €1.9 billion financing for the Tyrrhenian Link project. This submarine electricity cable, spanning 970 km and with a capacity of 1,000 MW, will connect Sicily and Sardinia with the Italian mainland, promoting renewable energy development, grid reliability, and energy security. The project, set to be completed by 2028, will see significant investments from Terna and involve approximately 250 companies, contributing to the regions’ economic growth.

(PRESS RELEASE) LUXEMBOURG, 9-Feb-2024 — /EuropaWire/ — On the sidelines of the second edition of the EIB Forum in Luxembourg, which brings together Heads of State, EU Commissioners, business leaders, academics and civil society representatives, the European Investment Bank (EIB) and Terna signed the contract for the final tranche of the €1.9 billion financing of the Tyrrhenian Link, the submarine electricity cable connecting the Italian mainland with Sicily and Sardinia. At the EIB Forum, a meeting took place between EIB Vice-President Gelsomina Vigliotti and CEO and General Manager of Terna, Giuseppina Di Foggia, to discuss future collaboration in support of the energy transition and REPowerEU objectives.

This final tranche of €500 million, in addition to the previous finance contracts signed on 8 November 2022 (first tranche of €500 million) and 30 March 2023 (second and third tranches, totalling €900 million), will support the construction and commissioning of the East and West sections of the Tyrrhenian Link. By connecting Sicily and Sardinia with the Italian mainland via a 970 km, 1 000 MW double submarine cable, the Tyrrhenian Link will foster the development of renewable sources, grid reliability and promote energy security in Italy.

Terna plans to invest around €3.7 billion in total for this infrastructure, which is key for Italy’s energy security. Around 50% of the project cost will be financed by the EIB, demonstrating the strategic nature of the project. The Tyrrhenian Link will be fully operational in 2028. Some 250 companies will be involved in its implementation, which will have a significant impact in the regions concerned.

With terms of around 22 years from each drawdown, the loans have a longer maturity and more competitive costs than those generally available on the market. This puts them in alignment with Terna’s policy to optimise its financial structure. This operation brings total EIB financing for Terna to around €3.8 billion.

Background information

European Investment Bank (EIB)

The European Investment Bank (EIB) finances sound investments that contribute to EU policy objectives. EIB projects bolster competitiveness, drive innovation, promote sustainable development, enhance social and territorial cohesion, and support a just and swift transition to climate neutrality. In the last five years, the EIB Group has provided more than €58 billion in financing for projects in Italy

Terna

The Terna Group is one of the leading European and global electricity transmission operators. It manages Italy’s national high-voltage transmission grid, with around 75 000 km of power lines over 900 electrical substations across the country. Its mission is to guarantee the secure operation, quality and efficiency of the Italian electricity system 24 hours a day, 365 days a year, and to ensure equal access conditions for all market operators. A centre of excellence comprising over 5 700 professionals, Terna plays a guiding role in the energy transition process towards complete decarbonisation and the full integration of energy from renewable sources into the grid.

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SOURCE: European Investment Bank