The EUR 570 million finance contract signed today in Rome between the European Investment Bank (EIB) and Terna, Italy’s power grid management company, is focused on investment in southern Italy. The EIB was represented at the signing ceremony by Dario Scannapieco, its Vice-President with responsibility for operations in Italy, Malta and the Western Balkans, and Terna by its CEO, Flavio Cattaneo.

Specifically, the loan will help support Terna’s 2012-2016 five-year plan to bolster Italy’s power transmission network, amounting to over EUR 1 billion. The plan is subdivided into 14 individual projects across Italy but with special emphasis on the Convergence Regions of Campania, Puglia, Sicily and Calabria. Some 69% of the EIB’s total financing is earmarked for projects located in these regions.

The flagship project in terms of both size and strategic importance is the Sorgente-Rizziconi interconnection, the section of the grid between Italy’s largest island, Sicily, and Calabria. Because of its significance, this project also receives EU funding of EUR 110 million under the EEPR (European Energy Programme for Recovery).

The loan to Terna is in line with the EU bank’s operational priorities in two ways in particular. The EIB is supporting plans to improve power networks − vital for reducing energy costs and narrowing price differences between regions. To be effective, these plans are also geared to improving the connection of renewable energy generation systems to the network, which will help reduce carbon dioxide emissions.

Furthermore, the geographical location in southern Italy of more than two thirds of the projects chimes with the EIB’s policy since its establishment of financing key operations in disadvantaged regions in order to foster harmonious socioeconomic growth within the European Union.