The European Bank for Reconstruction and Development (EBRD) has provided Ukrainian national energy company Ukrenergo with a loan of US$149 million to upgrade the country's transmission network.

The 15-year sovereign-guaranteed loan will be used to acquire up to 26 new transformers, as well as to conduct the automation and upgrade of 12 high-voltage substations in key locations of Ukraine's transmission network, according to Emerging Europe.

"The investment will help Ukrenergo upgrade its key transmission infrastructure required for the synchronization with the European electricity networks. It will also assist Ukraine in aligning its legal framework and operational practices with the EU's Third Energy Package," the EBRD said in a statement, adding that the contribution will also reduce annual CO2 emissions by 20,500 tonnes.

The financing is expected to strengthen Ukrenergo's capacity to accommodate the increasing share of renewables in the Ukrainian grid, with a growing share of solar and wind power.

With the new investment, the EBRD aims for the further institutional development and commercialization of the Ukrainian energy company.

The EBRD is the largest international financial investor in Ukraine. Since 1993, the bank has invested US$13.6 billion in the country.

As UNIAN reported earlier, the European Bank for Reconstruction and Development bought 20% of NJSC Naftogaz of Ukraine's five-year loan participation notes (LPN) worth EUR 120 million. The Bank's financing will be used exclusively for gas purchases.