5 Dec 2019
EUR 20 million
Financial institutions and SMEs
Electricity cables being laid underground. Photo: RARIK ohf.
NIB has signed a 15-year loan agreement with Icelandic energy company RARIK ohf. to finance the replacement of overhead electricity lines with underground cables to increase delivery reliability.
The EUR 25 million loan will secure the financing of the replacement of approximately 1,450 kilometres of overhead lines in Iceland with underground cables. The replacement work is scheduled to be finalised during 2020, and RARIK estimates total cost of the project at EUR 50.1 million.
The objective of this ongoing project is to reduce power outages and failures that stem from harsh weather conditions such as strong winds and ice. By replacing overhead lines with underground cables, the company further expects to increase its efficiency and productivity due to a reduced need for network maintenance and network disruption caused by damage arising from weather conditions.
RARIK has already replaced 4,700 kilometres of overhead lines with underground cables, representing 54% of its distribution network. Following the completion of this replacement work, approximately 2,800 kilometres of overhead lines will be remaining in RARIK’s distribution net. The company aims to replace its entire network with underground cables by 2035.
The electricity and heating distribution company RARIK ohf. serves areas outside of Iceland’s capital Reykjavik and distributes approximately 33% of all general energy in Iceland. In 2015, RARIK delivered a total of 1,328 GWh of electricity to 41,400 customers. The company also operates through a subsidiary an independent energy sales company which sells and produces electrical power of up to 260 GWh annually.
NIB is an international financial institution owned by eight member countries: Denmark, Estonia, Finland, Iceland, Latvia, Lithuania, Norway and Sweden. The Bank finances private and public projects in and outside the member countries. NIB has the highest possible credit rating, AAA/Aaa, with the leading rating agencies Standard & Poor’s and Moody’s.
For further information, please contact
Mr Sami Loukkola, Senior Manager, Lending, at +358 50 311 3698,
Ms Lisa-Maria Altenberger, Communications unit, at +358 10 618 0234,