Czech utility ČEZ secures €400mn grid upgrade loan from EIB

The European Investment Bank (EIB) is lending €400 million ($420.1 million) to Czech energy supplier ČEZ to upgrade and expand the electricity distribution grid across the country.

The new credit line aims to enhance the country’s energy independence by increasing renewables penetration.

Specifically, ČEZ plans to refurbish electricity networks, instal remotely controlled energy-supply systems and build infrastructure that can integrate new renewable-energy sources such as solar and wind power.

With the EIB loan ČEZ will upgrade the power grid that would be thus able to absorb an additional 5.5GW of new renewables.

The ČEZ works being funded by the EIB credit are due to be completed in 2026.

Commenting in a release was ČEZ chief financial officer Martin Novák: “ČEZ is modernising and decarbonising its power plant portfolio as well as facilitating the overall transition to a zero-carbon Czech energy sector.

“The overall volume of our investments to modernise our electricity network is increasing every year and gradually changing the shape of the whole distribution environment, where the need for faster access to information is growing. Modern technologies are penetrating all parts of electricity networks and, with our strong partnership with the EIB, we are committed to speeding up the process.”

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Added EIB vice-president Kyriacos Kakouris: “This loan represents a significant investment in modernising the Czech Republic’s electricity distribution network while accelerating the integration of renewable energy sources.

“The EIB is committed to financing projects that enhance energy resilience, support the green transition, and strengthen the Czech Republic’s energy independence. This partnership highlights the critical role we play together in driving sustainable growth and achieving the country’s energy-transition goals.”

According to the EIB, the loan to ČEZ aligns with the objectives of the European Commission’s REPowerEU plan, created in response to the global energy market disruption caused by the war in Ukraine.

The plan, backed by financial and legal means to build new energy infrastructure in Europe, aims to save and produce clean energy, as well as diversify energy supplies.

The new financing follows an €800 million ($840.2 million) loan earlier this year in September and a €790 million ($829.7 million) loan in 2022, both from the EIB to ČEZ to upgrade and expand the country’s distribution grid.

To date, the EIB has provided close to €2.8 billion ($2.9 billion) to ČEZ for projects that contribute to reliable, efficient and green electric supply and generation in the Czech Republic.