EDP, the Portuguese utility company, has successfully secured €700 million in loans from the European Investment Bank (EIB) to support the development of over 1.9 GW of renewable energy capacity and enhancements to distribution grids in Spain, Portugal, and Italy.
Loan Breakdown
The first tranche of €500 million will primarily fund EDP’s solar photovoltaic (PV) and onshore wind power projects across the three countries, each set to host approximately one-third of EDP’s planned 1.943 GW portfolio. This loan is part of a larger €900 million green framework loan agreement with the EIB. The projects funded by this loan aim to contribute up to 1.6 GW of solar PV and 384 MW of wind capacity, as EDP targets adding 18 GW of new renewable energy capacity by 2026.
The second tranche of €200 million will facilitate the expansion, development, and digitization of EDP’s power grids in Spain and Portugal. As electricity demand increases and Europe moves towards greater electrification, there is a pressing need for more resilient and expansive distribution networks. Grids have been identified as a significant barrier to the energy transition in developed nations.
Infrastructure Modernization
EDP plans to modernize critical infrastructure, including:
- Refurbishment and expansion of overhead lines and underground cables
- Upgrades to substations and transformers
- Implementation of digital solutions such as smart meters
Earlier this month, a report from consultancy DNV highlighted that congestion in the transmission grid could impede renewable energy development in Spain in the near term. However, it also noted that financial commitments, expansion efforts, and technological advancements would alleviate congestion challenges by 2050.
Strategic Importance
Rui Teixeira, CFO of EDP Group, stated, “These loans revive the long-term relationship between EDP and EIB and are fully aligned with the Group’s financial policy to extend the average maturity of its debt portfolio, reinforcing its financial flexibility.”
Earlier this month, EDP also commissioned a 103 MW solar PV portfolio in Italy, marking a significant step toward increasing its solar capacity, having traditionally focused on wind power.
Sources
- EDP Group Official Website
- European Investment Bank Press Release
- DNV Report on Renewable Energy Development
