The European Investment Bank (EIB) has signed a €500 million finance contract with Terna for the east section of its Tyrrhenian link connecting Sicily with Campania. The aim of the Tyrrhenian link is to connect Sicily with Sardinia and the Italian peninsula via a 970 km, 1,000 MW DC double submarine cable, contributing to the development of renewable energy sources, power grid reliability and energy security.
The loan signed today is the first tranche of €1.9 billion approved by the EIB for the Tyrrhenian link. Terna is planning an overall investment of around €3.7 billion for building the Tyrrhenian link, with the submarine electricity cable connecting the Italian peninsula with Sicily (East section, whose first cable will be operational at the end of 2025) and then to Sardinia (West section). The infrastructure will be fully operational in 2028. It is estimated that around 250 companies will be involved in the implementation of the project, with important spin-offs for the Regions involved.
EIB Vice-President Gelsomina Vigliotti said: “As world leaders gather for COP27 in Egypt, the EIB, as the EU climate bank, is pleased to have signed the first €500 million tranche supporting the construction of the Tyrrhenian link. This piece of infrastructure is of huge strategic importance to ensuring Italian energy security, as well as to cutting CO2 emissions and fostering the development of renewable energies, thereby reducing the cost of our bills. This operation also serves to consolidate our already excellent partnership with Terna, which aims to promote the energy transition and climate neutrality by 2050.”
“We are particularly happy that the European Investment Bank has recognised the strategic importance of the Tyrrhenian link, a key piece of infrastructure for the security of the Italian power grid. The Tyrrhenian link is the world’s biggest undersea energy transmission project, a work of Italian engineering excellence that will decisively accelerate the development of renewable energy sources,” added Terna CEO Stefano Donnarumma.
The 22-year loan has a longer maturity and more competitive costs than those generally available on the market, in line with Terna’s policy to optimise its financial structure.
This operation brings total EIB financing for Terna to €2.6 billion and the remaining €1.4 billion for the other Tyrrhenian link project tranches already approved by the Bank.
Image source: Courtesy of EIB
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