The Nordic Investment Bank is to loan Norway’s grid operator Statnett 1,300 million kroner ($226.8 million) as part-financing for a subsea cable connecting with Denmark.

The money will also be used to upgrade Statnett’s existing cable across the Oslofjord. 

The Norway-Denmark high voltage direct current cable will cross the Skagerrak strait, be 240 km long – of which 140 km is under the sea bed – and have a capacity of 700 MW.

It is expected to be completed by the end of 2014, while the upgrade to the Oslofjord, which supplies electricity in eastern Norway, is scheduled to be finalised by late next year.

President of the Nordic Investment Bank Johnny Akerholm said: “Security of supply and environmental sustainability are key challenges for the energy sector in the bank’s member countries and beyond.”