An EU bank has agreed to provide a loan worth €500 million (£424.8m) to help France upgrade its electricity grid.

The cash from the European Investment Bank (EIB) will finance seven high voltage and very high voltage power grid projects until 2016. RTE, France’s power grid owned by EDF, signed an agreement for the first €300 million (£255m) yesterday and the rest will be completed in 2014.

The deal will pay for the completion of the Cotentin-Maine high voltage line, which links EDF’s EPR reactor being built in Normandy to the grid and for power links in eastern and southern France.

Philippe de Fontaine Vive, EIB Vice-President said: “This loan demonstrates our commitment to supporting energy in France. Our goal is to develop secure, competitive and sustainable energy. This will involve optimising the quality and security of energy supply while incorporating new power generation facilities, especially from renewable sources. This project will also be a source of employment in the regions concerned.”

RTE said it would spend almost €8 billion (£6.8bn) by 2016 to add and upgrade electricity transmission lines as the nation plans to lower its reliance on nuclear power and increase renewable energy generation.