EIB Unveils €16 Billion Investment for Spain-France Electricity Interconnection
The European Investment Bank (EIB) has announced a significant investment of €16 billion aimed at financing the electrical interconnection between Spain and France across the Bay of Biscay, with operations set to begin in 2028. This initiative, which was revealed on Monday, follows the signing of initial loan agreements with the entities managing the electrical grids in both countries.
According to the EIB, the project is emblematic for the European electrical system, enhancing the interconnection capacity between the Iberian Peninsula and the rest of continental Europe. Currently, the exchange capacity stands at 2,800 megawatts (MW), but this new endeavor is expected to boost it to 5,000 MW. This enhancement will not only improve the reliability of electrical supply between France, Spain, and Portugal but also provide power to approximately two million homes.
The agreement was formalized in Luxembourg, roughly six weeks after a significant blackout in the Iberian region. The project will feature the first-ever submarine electrical interconnection between Spain and France, extending a total of 400 kilometers, of which 300 kilometers will be underwater.
Considered a 'Project of Common Interest' for the European Union, the construction efforts are conducted by a joint venture between Red Eléctrica de España and Réseau de Transport d'Électricité (RTE) of France. The EIB has finalized the first segments of the loans totaling €12 billion for this vital project, in addition to an earlier grant of €578 million allocated through the Connecting Europe Mechanism.
The signing ceremony saw the participation of key figures including EIB President Nadia Calviño, European Commissioner for Energy Dan Jorgensen, French Minister for Industry and Energy Marc Ferracci, and Spanish Undersecretary for Ecological Transition and Demographic Challenge Miguel González Suela.
Despite the potential benefits, France has expressed concerns regarding the financial implications associated with the interconnection project. French officials, including Minister Ferracci, have indicated that while they are open to discussing improvements in electrical interconnections with Spain, any new lines would necessitate augmenting France’s internal electrical grids, which could be costly.
As both countries navigate the aftermath of the Iberian blackout that occurred on April 28, discussions are expected to focus on the lessons learned and future commitments to enhance electrical cooperation. Minister Ferracci is slated to meet with his Spanish counterpart at the European Ministers Council taking place in Luxembourg, where they will address the complexities of the recent blackout and the necessary steps for improvement.
Sources have revealed that Ferracci received a letter from his Spanish and Portuguese counterparts about ten days ago, which called for specific deadlines and binding commitments concerning electrical interconnection corridors. This follows concerns that existing plans do not sufficiently address the critical energy ties between the Iberian Peninsula and mainland Europe.
Minister Ferracci has emphasized the importance of collaboration among Spain, Portugal, and France to accurately diagnose the causes of the recent blackout. He suggested that a transparent sharing of data would be essential for a comprehensive understanding of the crisis.
In contrast to the collaborative tone that Spanish Minister Aagesen has adopted regarding France's support in restoring power quickly post-blackout, there has been criticism directed towards the Portuguese minister's comments that seem to inadequately attribute responsibility to France. The rising complexity of communication reveals the increasing tensions surrounding energy interdependence in the region, with Spain and Portugal advocating for stronger interconnectivity that would mitigate possible future crises.
As the European Commission pushes for enhanced electricity flows across member countries, the pace of progress on these essential projects remains a critical topic, particularly as France's reluctance often hampers advancement. The future of energy collaboration between Spain and France hinges on overcoming these challenges, ensuring that the benefits of the EIB's substantial investment are fully realized.
Related Sources: