Norway. Arva AS
| Date of agreement: | 29 Feb 2024 |
|---|---|
| Country: | Norway |
| Customer: | Arva AS |
| Amount in NOK: | NOK 500 million |
| Amount in EUR: | EUR 43.7 million |
| Maturity: | 7 years |
| NACE sector / loan type: | Transmission and distribution of electricity |
Financing from NIB Environmental Bond proceeds
NEB-eligible share: 100%
NEB category: Renewable energy
Amount disbursed: EUR 42.8 million
Note: For loans in other currencies than EUR, the equivalent in EUR is based on the exchange rate effective for the disbursement. Read more about the NIB Environmental Bonds
Facilities
Arctic Financing Facility (read more): 100%
Project
The loan has been provided for the company to improve the efficiency and resilience of the electricity distribution network during 2023-2024. The objective is to enable the further electrification of Northern Norway.
The projects consist of new power lines, cables and sub-stations, and the refurbishing of older infrastructure. In total, some 110 kilometres of power lines and cables will be installed. About half of the projects relate to new infrastructure and the other half are upgrades. The projects include five substations adding a capacity increase of around 30 megavolt ampere (MVA).
The loan from NIB will finance 32% of the investment costs.
Arva AS is the sixth largest distribution grid operator in Norway, established from a merger between the grid operations of Troms Kraft and Bodø Energi in 2020.
In 2021, Arva signed a NOK 400 million loan with NIB for its 2020-2022 investments to strengthen the electricity distribution network in Northern Norway.
Fulfilment of NIB's mandate
Productivity
Arva’s investments are expected to increase the distribution capacity by 50-100 MW, corresponding to around 10% of the current capacity.
The general capacity demand of electricity in Arva’s area of operation is expected to increase between 300-900 MVA in the coming decade. This is due to an increasing population, the electrification of society, as well as the industrial transition.
Environment
The objective of the investment is to meet the increased capacity demands due to the general electrification of the society, e.g. charging infrastructure for vehicles, ports, and fish-farms.
A key climate change adaptation risk is related to the higher vulnerability of power lines compared to underground cables. The project portfolio consists of approximately 50% overhead power lines and the remaining as cables.
Expected impact
- Increased capacity to the grid, 50-100 MVA
Sustainability summary
Arva’s strategy for the 2022–2024 period focuses on sustainability, underpinned by the national climate targets, the transition to a low-emission society and the realisation of the green transition. The strategy focuses on how Arva will create value for its owners, services to their customers, being an attractive workplace for their employees while looking after the needs of future generations.
