The project, which will deliver an underwater connection between the countries, has secured a €530 million investment by the European Commission.
Confirming the funding, An Taoiseach Leo Varadkar said: "This is a really significant investment for Ireland and will help us to conduct a magnificent feat of engineering. The Celtic Interconnector will help to lower electricity prices, reduce greenhouse gas emissions and provide greater energy security. It's a direct result of our close working relationship with the European Commission including President Juncker, and France and President Macron, who will be our closest EU neighbours following Brexit. It's a signal of European solidarity at this crucial time."
Once built, the connector's 700 megawatts capacity will power 450,000 households, and help Ireland to switch to 70% renewable energy as set out in the Government's Climate Action Plan.
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A vital part of Project Ireland 2040, the Interconnector is likely to drive down electricity prices for the consumer through increased competition.
Once Britain leaves the EU, Ireland will have no electricity interconnection with any member of the European Union. By providing a direct electricity link with mainland Europe, Ireland will be connected to the EU's Internal Energy Market post-Brexit.
Environment Minister Richard Bruton added: "This vital piece of infrastructure is crucial to delivering the step up required to meet the climate challenge. As well as the clear benefits in terms of improved security and diversification of electricity supply, it will also, importantly, facilitate the further development of renewable energy, helping us meet our 70% target. We can also expect consumer prices to come down as operators work in a more competitive market."
The investment was secured under the EU's Connecting Europe Facility. The application was made possible by the status of the Celtic Interconnector as a Project of Common Interest (PCI). Projects with PCI status are recognised as essential for completing the European Internal Energy Market and for reaching the EU's energy policy objectives of affordable, secure and sustainable energy.
The project is being jointly developed by EirGrid and its French counterpart Réseau de Transport d'Électricité (RTE), and has, over several years, been supported by Ireland during the EU PCI process.
Construction is expected to begin on the Celtic Interconnector as early as 2022 and be completed by 2026.
(CM/MH)
