EIB Commits €1.6 Billion to Bay of Biscay HVDC Subsea Link
The European Investment Bank (EIB) has announced a €1.6 billion financing package to support the construction of the first submarine high-voltage direct current (HVDC) electricity interconnection between Spain and France, the 'Biscay Gulf' HVDC interconnector. This landmark Bay of Biscay project is set to nearly double the electricity exchange capacity between the two nations, advancing the integration of the Iberian Peninsula into the broader European power grid.
The interconnection will span approximately 400 km, with 300 km laid as submarine cables beneath the Bay of Biscay. The route connects the Gatika substation near Bilbao, Spain, to the Cubnezais substation near Bordeaux, France. The link will boost cross-border exchange capacity from 2,800 MW to 5,000 MW, a critical leap for regional energy security and market integration. The project features two parallel HVDC links, each rated at 1,000 MW, ±400 kV. The EPC contracts for the HVDC submarine and land cables have been awarded to NKT and Prysmian, while Hitachi Energy and Vinci will supply the converter stations. Construction has commenced, with commissioning targeted for 2028.
By increasing interconnection capacity, the project will enhance grid stability, support the integration of renewable energy, and reduce price volatility in the Iberian and French markets. The interconnector is projected to avoid approximately 600,000 tonnes of CO₂ emissions annually by optimizing the flow of low-carbon electricity across borders. The Bay of Biscay link is classified as a Project of Common Interest (PCI) by the European Union and aligns with the REPowerEU initiative, highlighting its role in strengthening the continent’s energy security and resilience.
The €1.6 billion EIB loan is distributed between Spain’s Red Eléctrica and France’s RTE, the national transmission system operators, through their joint venture Inelfe. The project also benefits from a €578 million grant under the Connecting Europe Facility, covering a significant portion of the total €2.85 billion budget. Spain and France will share the remaining costs, with Spain covering 54% and France 46%.
The signing ceremony at EIB headquarters in Luxembourg was attended by top EU and national energy officials, underscoring the project’s strategic importance. EIB President Nadia Calviño described the link as a “bridge between nations that will strengthen European cohesion,” while EU Commissioner Dan Jørgensen emphasized the necessity of integrated grids for stable, affordable power delivery.
The submarine cables will be buried where possible to minimize environmental impact and avoid marine hazards such as the Capbreton submarine canyon. State-of-the-art HVDC converter stations will be constructed at both ends, ensuring efficient and reliable conversion between AC and DC systems. The link is expected to supply the equivalent of over two million households and will help Spain meet the EU’s 15% interconnection target.
