The European Investment Bank (EIB) is providing up to €43 million (£35.8m) to finance the modernisation of a heating network in Vilnius, Lithuania.

Around 17 kilometres of old pipelines will be replaced with modern, pre-insulated ones by Vilniaus Šilumos Tinklai (VŠT) as worn-out pipelines are currently causing major heat loss and increasing the risk of accidents.

Under the project, a biomass combined heat and power (CHP) plant will be installed, along with a solar energy connector.

The project is expected to ensure residents in Vilnius have access to a more reliable heat supply as well as contribute to environmental protection by improving energy efficiency and reducing greenhouse gas emissions.

VST is the largest provider of heating and hot water, servicing more than 210,000 households and businesses in the capital city.

Gerimantas Bakanas, VŠT Chief Executive Officer said: “The modernisation and expansion of the network is an important step for the company in the long term. We are happy that the approach to energy efficiency and environmental protection correlates with that of the EIB — due to this investment, we can fundamentally modernise Vilnius.

“Moreover, this contract will allow the financing of lower value projects and repairs that will make our work ‘greener’ and more sustainable.”