The European Investment Bank (EIB) has agreed to provide £500 million (€620.89 million) to support a major reinforcement of the electricity transmission network in the north of Scotland to improve connections between wind, wave and tidal renewable energy schemes, and the national power network.

The EIB said the new power link would help secure the supply of electricity in the Highlands region and beyond for generations to come. It added that once operational, the new transmission link would supply electricity that was equivalent to meeting the needs of around 2 million Scottish residents.

The new investment, said to represent the largest investment in the electricity network in the north of Scotland for 60 years, includes a new 1,200MW subsea cable between Spittal in Caithness and Blackhillock in Moray.

The long-term EIB loan will support nearly €1.2 billion (€1.49 billion) of overall investment in the electricity transmission network in the north of Scotland by Scottish Hydro Electric Transmission, a wholly-owned subsidiary of British energy supplier SSE.

The first part of the loan totalling £300 million (€371.91 million) has been signed, and the remainder is expected to be signed next year as the project progresses.

Jonathan Taylor, EIB vice president, said, “Investment in energy infrastructure across the UK is essential to harness the full potential of new and future renewable energy schemes.”

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