The European Investment Bank (EIB) will provide €500m ($719.70m) in financing to support the development of a high-voltage direct current (HVDC) power transmission link to connect the electricity grid on either side of the Moray Firth in northern Scotland.
Being built by SSE subsidiary Scottish Hydro Electricity (SHE) Transmission, the Caithness Moray transmission project involves development of a 100 mile-long subsea cable between Spittal in Caithness and Blackhillock in Moray.
The firm is investing more than £1.1bn in the Caithness Moray transmission project, which is expected to supply electricity to meet the needs of around two million Scottish residents.
Scottish Hydro Electric Transmission director David Gardner said: "This project represents the largest investment in electricity network in the north of Scotland since the hydro development era of the 1950s and we are proud to be an integral part of it; delivering value for money while reinforcing the network, allowing for the connection of new generation and providing a more resilient power supply to those who live and work in the area."
Planned to be completed in 2018, the project is designed to improve connections between wind, wave and tidal renewable energy schemes and the national power network.
European Investment Bank vice-president Jonathan Taylor said: "Investment in energy infrastructure across the UK is essential to harness the full potential of new and future renewable energy schemes.
"The European Investment Bank is pleased to provide GBP 500 million to support essential investment by Scottish Hydro Electric Transmission that will ensure more efficient transmission of green energy, enable increased use of renewable power in Scotland and secure energy supply to the Highlands and Scotland’s cities."
About 600 jobs are expected to be created during the construction of subsea cable and associated onshore infrastructure works.