All agreed loans

Finland. Caruna Networks Oy

Date of agreement: 6 Jun 2018
Country: Finland
Customer: Caruna Networks Oy
Amount in EUR: EUR 150 million
Maturity: 15 years
NACE sector / loan type: Electricity, gas, steam and hot water supply


The loan has been provided for upgrading electricity distribution grids during 2017–2018, to enhance the reliability of supply.

The project includes grid cabling to replace existing medium- and low-voltage overhead lines, installation of new transformers compliant with EU regulations, replacing outdated pole-mounted transformers, as well as installing equipment that can localise grid faults better.

The network upgrades are designed to meet higher regulatory requirements on the reliability of supply, and strengthening the ageing network to meet future electricity usage patterns. Caruna’s total project costs are EUR 394 million.

Caruna Networks Oy transmits electricity to 672,000 customers and is Finland's largest distribution system operator, with a 21% market share. Its electricity networks are located in in south, south-western, western and northern Finland, and in the city of Joensuu. Caruna is owned by the Canadian pension fund Ontario Municipal Employees Retirement System (OMERS) (40%), the Commonwealth Bank of Australia’s investment management company First State Investments (40%), Finland’s largest pension fund Keva (12.5%), and Finland’s third largest mutual pension insurance company Elo (7.5%).

Fulfilment of NIB's mandate

The upgrade is expected to lead to an increase of ten percentage points over 2016 in the proportion of the company’s network that is weatherproof. The cabling rate of the company’s network is also expected to increase from 35% in 2015 to more than 50% in 2019.

The improvements in security of supply are expected to significantly reduce the costs Caruna incurs from network outages. In terms of the distribution volumes and the length of the networks, Caruna is the largest electricity distribution company in Finland. The investment will therefore bring widely distributed benefits to households and businesses in the region.

The key drivers for the grid refurbishment investments are higher regulatory requirements on the reliability of supply, and to strengthen the ageing network to meet future usage patterns of power.

The planned measures are assessed to improve the energy efficiency of the grid, as the power losses from the refurbished grid will be lower.

Strengthening the oldest parts of the grid will also improve the network’s capability to connect more small-scale decentralized power generation. Currently the total capacity of such units connected to Caruna’s network is 46 MW.

Other environmental benefits of the investment programme include the reduced visual impact of the grid due to dismantling of old overhead lines and the lower risk of oil spills due to the replacement of pole-mounted transformers.

Sustainability summary

The project is not assessed to have any significant negative environmental or social impacts.

Dismantled network material will be recycled. For this purpose, Caruna adopted a new recycling strategy in 2015 and has entered into a contract with a specialised recycling company.

Press release

NIB finansierar förbättring av elnät i Finland


Press release

NIB rahoittaa Carunan sähköverkon uudistusta