- The €790 million in financing by the EIB will help the Czech national utility company ČEZ upgrade and expand the country’s electricity distribution grid.
- The loan will promote the Czech Republic’s energy independence by enabling ČEZ to connect around 2.2 GW of new renewable energy sources.
- The financed investments will help provide a more reliable electricity supply for businesses and households across the Czech Republic.
- The operation is the biggest EIB loan for the Czech Republic signed to date.
The European Investment Bank (EIB), the bank of the European Union, will lend €790 million to the Czech energy utility company ČEZ. The loan will fund the expansion of the national electricity distribution network, including the installation of automation technology and remotely controlled energy supply systems. ČEZ will also make upgrades to increase reliability of the electricity supply in nine regions of the Czech Republic.
With the new infrastructure, ČEZ will integrate up to 2.2 GW of new renewable energy sources, promoting the country’s energy independence and green transition. This is the largest loan the EIB has ever granted for the Czech Republic.
EIB Vice-President Lilyana Pavlova, who oversees EIB operations in the country, said, “The EIB continues to support modernisation of the Czech energy sector, this time with the biggest loan we’ve signed there to date. This is an important step towards an energy-independent Czech Republic, now an even more urgent matter given the current energy crisis. At the same time, the loan supports the European Commission’s REPowerEU plan to make Europe independent from Russian fossil fuels well before 2030, which objective is especially relevant in light of Russia's invasion of Ukraine. The loan also has a significant green component, as ČEZ will be able to integrate new renewable energy sources into its grid and accelerate decarbonisation of the Czech economy.”
ČEZ CFO Martin Novák commented, “We welcome this new loan by the EIB that will help us accelerate the modernisation of the distribution grid and integrate the new renewable energy sources that the Czech Republic needs to meet its climate targets and strengthen its energy security, as well as the energy independence of our customers. The number of renewables we have built for our customers has tripled year-on-year in 2022, and the number of applications for new connections of renewables that will be built in the near future has reached 80 000 to date. ČEZ is committed to upgrading the distribution network significantly, and our partnership with the EIB is one of the cornerstones of this effort.”
To date, the EIB has provided some €2.6 billion to ČEZ for projects that contribute to a reliable, efficient and green electric supply. With this loan, total EIB investment in the Czech energy sector has reached €3.45 billion. This cooperation has accelerated the green, sustainable growth of the Czech economy.
The loan to ČEZ furthers the objectives of the European Commission’s REPowerEU plan created in response to the hardships and global energy market disruption caused by Russia’s war of aggression. The plan aims to save and produce clean energy and diversify our energy supplies and is backed by financial and legal means to build the new energy infrastructure that Europe needs. REPowerEU sets out a series of measures to rapidly reduce dependence on Russian fossil fuels and fast-forward the green transition, while increasing energy system resilience EU-wide. The plan is based on finding alternative energy supplies, making behavioural changes to save energy and spurring investment in renewable energy.
The European Investment Bank (EIB)
The EIB Group has adopted a Climate Bank Roadmap to deliver on its ambitious agenda to support €1 trillion in climate action and environmental sustainability investments in the decade to 2030, and to deliver more than 50% of EIB finance for climate action and environmental sustainability by 2025. As part of the roadmap, all new EIB Group operations have been aligned with the goals and principles of the Paris Agreement since the start of 2021.
ČEZ is one of the biggest companies in the Czech Republic and a leader in European energy utilities, operating in Western, Central, and South-Eastern Europe. ČEZ is committed to setting an example and making the energy sector sustainable, greener and friendlier to our planet. It strives for more diversity, for closer cooperation with communities and to always offer the best technological and energy-saving solutions to the customers. The ČEZ strategy — Clean Energy of Tomorrow — aims to significantly increase the number of renewable energy sources in the company’s portfolio, as well as among its customers. ČEZ aims to be climate-neutral by 2040.
The EIB and energy security
Over the past decade, the EIB Group has channelled almost €100 billion into the European Union’s energy sector. These timely investments are now helping Europe weather the crisis triggered by the abrupt cut in Russian gas supplies. In the first nine months of this year alone, the EIB signed financial support totalling more than €8.3 billion for projects in energy efficiency, renewables, electricity and storage inside the European Union, strengthening the resilience of the European economy.
In October, the EIB’s Board decided to raise the Group’s clean energy financing volumes to unprecedented levels in support of the REPowerEU objective of ending Europe’s dependency on Russian fossil fuel imports. An additional €30 billion will be invested over the next five years, on top of the EIB’s already robust support for the EU energy sector. It is estimated that the REPowerEU package will mobilise an additional €115 billion in additional investment by 2027, thereby making a substantial contribution to Europe’s energy independence and the EIB Group’s target to mobilise €1 trillion in climate financing this decade.
Find out more about the EIB’s energy support here and the latest energy projects we financed here.