European Investment Bank to modernise electricity distribution network in the Czech Republic. Credit: ©EIB.

The European Investment Bank (EIB) has agreed to finance an investment programme to upgrade the electricity distribution network in the Czech Republic.

As part of this initiative, Czech energy utility CEZ will receive a €330m loan, which will be used by the utility firm to modernise the network across nine regions, including Central Bohemia, Liberec and Olomouc.

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EIB vice-president Lilyana Pavlova said: “The project will boost the network’s capacity and will make it fit to integrate more electricity from renewable sources, thereby fostering the move from centralised to de-centralised electricity generation.

“This is not only good news for households and companies, but it’s also an important groundwork in our fight against climate change.”

The project will see the installation of 4,160km of new overhead as well as underground lines, refurbishment of 2,475km of lines and setting up an additional of the transformer with 861MVA capacity on the electricity network.

Additionally, the funding provided by the EIB will be used for the installation of automation and tele-control systems.

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The funding will also help facilitate climate action through increased integration of future capacity from renewable sources.

Around 20,000 new users are expected to benefit from reliable electricity supply annually under the investment programme.

CEZ chief finance officer Martin Novák said: “The EIB has been a trusted financing partner of CEZ for the last ten years.

“Cooperation with the EIB has allowed CEZ to diversify its sources of funding by complementing traditional debt capital markets without compromising its desire for financing with long maturities.

“I am very pleased that this particular loan will facilitate investments supporting decentralised electricity generation in the Czech Republic.”