Polish ORLEN Group and EIB sign $220 million loan agreement

The European Investment Bank and ORLEN Group, Poland’s largest energy holding, has signed a PLN 900 million (approximately $220 million) loan agreement to support the energy transition, the EIB said.

The funds will be used to invest in strengthening and expanding the electricity grid of Energa, the distribution system operator majority-owned by ORLEN.

“This new EIB support will help modernize electricity distribution in northern and central Poland and will also enable the connection of more renewable energy sources,” the European Investment Bank said.

The position is the first in a total of PLN 3.5 billion approved by the EIB for the expansion of Energa’s grid in 2024-2025.

“This new transaction confirms the EIB’s role as a reliable partner in Poland’s energy transition,” said EIB Vice-President Tereza Czerwińska.

About the deal

EIB financing supports Energa’s investment plan to improve the security and efficiency of energy supply. This includes adding new customers and increasing renewable energy capacity by around 4.8 GW, as well as modernising the distribution network and investing in smart grids.

The agreement between the EIB and ORLEN Group was concluded as part of the REPowerEU programme, which aims to increase the bloc’s energy independence by diversifying energy supply and accelerating the transition to a green economy.

The EIB will provide €45 billion in loans and equity financing by 2027 to achieve the objectives of REPowerEU. According to the agreement with ORLEN Group, the EIB value will be paid in tranches over a three-year period from the date of execution, with the repayment of the distribution being made over a maximum of 15 years from the date of the initial payment.

EIB and ORLEN

The Group EIB is an EU institution that provides long-term financing to projects selected by the EU. The EIB’s shareholders are the Member States. Its involvement contributes to economic competitiveness, stimulates innovation, sustainable development, strengthens social and territorial cohesion and supports a swift and fair transition to climate neutrality. In 2023, the EIB Group provided new financing totalling EUR 88 billion for over 900 projects, of which EUR 49 billion was allocated to green investments. These funds are expected to support a total investment of 320 billion euros, create 400,000 companies and create 5.4 million jobs.

ORLEN Group is an integrated multi-sector energy company, included in the prestigious Fortune Global 500 ranking. Thanks to recent acquisitions and mergers, it has become one of the 150 largest companies in the world. The company operates in 10 domestic markets: Poland, the Czech Republic, Germany, Lithuania, Slovakia, Hungary, Austria, Canada, Norway and Pakistan.

By the end of this decade, ORLEN will invest over PLN 320 billion in the implementation of strategic projects, of which approximately 40% will be directed to environmental investments, including offshore and onshore wind energy, solar energy, biogas and biomethane, biofuels, electric vehicles, green hydrogen and synthetic fuels.