EIB’s loan will be used for the replacement of high and low voltage cables. Credit: Matthew Henry.

The European Investment Bank (EIB) has agreed to provide a loan of €100m to Finnish electricity distribution system operator (DSO) Elenia.

The company will use the loan to improve the power supply quality and security of its distribution network.

Specifically, it will replace high- and low-voltage cables, substations and transformers.

Additionally, the EIB loan is expected to support Elenia in successfully continuing its capex programme in the region.

Elenia CFO Tommi Valento said: “In these troubled times it is very important that Elenia can continue its capex programme as planned.

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“We need to try to keep the economy functioning to avoid companies going into financial distress and unemployment rising. The execution of capex programme brings substantial work for our contractor partners and their subcontractors.”

To ensure uninterrupted power supply, Elenia’s long-term investment plan focuses on building an underground electricity network and replacing old overhead lines.

By 2028, the company aims to increase the underground cabling rate of the electricity distribution network to 75% from over 50%.

This will enable the company to maintain uninterrupted electricity supply to its customers and reduce outages.

Currently, the company operates in more than 100 municipalities with approximately 67,600km of distribution network.

EIB has been offering long-term loans to support sustainable investment projects that contribute to furthering EU policy objectives.

Last December, EIB agreed to finance an investment programme to upgrade the electricity distribution network in the Czech Republic.