Bavaria, GERMANY - The project will deliver excellent economic benefits, as it will help reduce the current, significant grid management costs caused by the existing bottleneck.

TenneT has announced that The European Investment Bank (EIB) is providing electricity transmission system operator TenneT with a senior loan of €450 million ($444 million).

According to TenneT, the project comprises the construction of a 185 km (115 miles) long electricity transmission corridor - the Ostbayernring - connecting Redwitz to Schwandorf in the south-east of Germany. The project is part of the federal grid expansion plan that aims to increase the grid’s capacity and prepare it for better integration of renewable energy. The existing grid structure has to be adapted to the challenges of transporting energy from north to south, but also within the regions.

According to the company, the project will deliver excellent economic benefits, as it will help reduce the current, significant grid management costs caused by the existing bottleneck. In the future, it will also set the conditions for increases in cross-border transmission capacity with the Czech Republic, thereby strengthening the European energy system.

TenneT Chief Financial Officer Arina Freitag added: “We welcome the fact that EIB is once again underlining its commitment to our grid expansion projects and thus to the energy transition. The Ostbayernring is a good example of how sustainable financing can strengthen security of supply and the green transformation of an industrial region at the same time.”

Source: TenneT