EIB Provides €700M to EDP for Renewable Energy and Grid Expansion Projects in Southern Europe

A €500 million loan has been provided as the first tranche of an approved €900 million green framework loan aimed at boosting renewable energy generation across Southern Europe.

The European Investment Bank (EIB) has announced two major loans totaling €700 million to EDP SA, which will be used to finance EDP Renewables’ energy projects in Portugal, Spain, and Italy, as well as the expansion and modernization of EDP’s electricity distribution networks in Spain and Portugal. These loans are a crucial part of Europe’s efforts to accelerate its green transition, reduce dependence on fossil fuels, and enhance energy security.

A €500 million loan has been provided as the first tranche of an approved €900 million green framework loan aimed at boosting renewable energy generation across Southern Europe. The loan will support the expansion of EDP Renewables’ solar photovoltaic and onshore wind energy plants in Portugal, Spain, and Italy, with each country contributing roughly a third of the 1,943 MW total planned installed capacity.

The new renewable installations are set to provide enough green energy to power more than 1 million households annually, helping EDP achieve its ambitious goal of adding 18 GW of renewable capacity by 2026. The plan includes the development of 1,559 MW of photovoltaic capacity and 384 MW of onshore wind projects between 2024-2026. This initiative will play a key role in Europe’s push toward net-zero emissions and the transition to a cleaner, more sustainable energy system.

€200 Million Loan for Grid Expansion and Digitalization

A second €200 million loan has been provided as the first tranche of an approved €800 million investment loan designed to finance the expansion, digitalization, and modernization of EDP's power distribution networks in Spain and Portugal. This project aims to address growing demand for energy, enhance the integration of renewable energy sources, and improve the resilience of the electrical grid.

The loan will fund critical infrastructure upgrades, including the refurbishment of overhead lines, the expansion of underground cables, and the enhancement of substations and transformers. In addition, smart technologies such as smart meters will be implemented to improve energy management, reduce network losses, and facilitate the seamless integration of more renewable energy.

Driving Europe’s Green Transition

The financing operations reflect the EIB’s commitment to supporting the EU’s green transition and its role as the Climate Bank. As part of the REPowerEU initiative, the projects will help to accelerate the shift to a greener energy system, reduce the EU’s dependence on fossil fuel imports, and increase the resilience of Europe’s energy grids.

Nuno Ascenso Pires, Head of the EIB Portugal Lending Division, expressed the bank’s enthusiasm for the projects, stating: “We are proud to support EDP in its efforts to scale up renewable energy production and expand power distribution networks. These projects will help accelerate Europe’s green transition, reduce dependence on fossil fuels, and enhance energy security, all key strategic objectives for the European Union.”

EDP’s Vision for a Sustainable Future

The €700 million financing aligns with EDP’s broader financial and sustainability strategy. Rui Teixeira, CFO of EDP Group, highlighted the importance of the loan for supporting the company’s efforts to expand renewable energy and modernize infrastructure. “These loans strengthen our financial flexibility and reinforce our commitment to the energy transition. EDP is a global leader in renewable energy, with a portfolio of 29.4 GW of installed capacity. With the EIB’s support, we can continue driving renewable energy deployment and fortifying power distribution networks, contributing to a more sustainable and resilient energy system,” he said.

Boosting Energy Security and Supporting the EU’s Strategic Goals

The financing for EDP is part of the EIB’s broader €45 billion investment plan aimed at supporting REPowerEU, which is designed to reduce Europe’s reliance on fossil fuels and boost energy security. In 2023, the EIB Group provided over €21 billion in financing for energy security projects, including renewable energy, energy efficiency, and power grid modernization. The expanded REPowerEU plan will mobilize €150 billion in investments by 2027, targeting key sectors such as green technologies, raw materials, and energy storage systems.

These strategic investments will not only support the EU’s energy security and climate goals, but also create new economic opportunities in cohesion regions, where per capita income is below the EU average.

The EIB’s €700 million loan to EDP is a landmark step in the fight against climate change and the drive for a sustainable, resilient energy future in Europe. With the dual focus on expanding renewable energy generation and modernizing energy distribution networks, these projects will contribute significantly to the EU’s climate and energy objectives, ensuring a greener, more secure future for all.