The new long-term loan will be used for connecting new power generation, modernizing ageing assets and enhancing network resilience to climate and security risks.
European Investment Bank vice president Jonathan Taylor said: "Investment in the UK electricity transmission network is essential to prepare for future demand, connect new sources of renewable energy and upgrade old facilities.
"This agreement, the largest ever single loan to be provided by the European Investment Bank, reflects both the scale of energy investment needed and National Grid’s own experience in implementing such a diverse capital investment programme."
Additionally, the loan will include capital investment by National Grid to develop infrastructure between the Wirral and Scotland, and the London Power Tunnels.
National Grid global tax and treasury director Malcolm Cooper said: "This significant European Investment Bank loan will be used to fund infrastructure investment and build an electricity network for the future."
National Grid will also utilize the finance for improvements to protect critical infrastructure from floods and provide substation capacity needed for new connections to offshore wind farms and new interconnectors to continental Europe.
Approximately £22bn was provided by the EIB over the last five years for investment in UK infrastructure including transport, social housing, hospital, water, schools and universities.
Image: Officials at London Power Tunnels. Photo: courtesy of National Grid.
