The European Investment Bank (EIB) is set to offer £500m to improve the power transmission network in Scotland.

The project will include a 1,200MW subsea cable between Spittal in Caithness and Blackhillock in Moray. It aims to upgrade connections between wind, wave and tidal renewable energy schemes and the national power network.

Scottish Hydro Electric Transmission, a wholly-owned subsidiary of SSE, is building the project, which is due for completion in 2018. The company is investing over £1.1bn in the project.

Once operational, the new link is expected to supply equivalent electricity to meet the needs of about 2m Scottish residents. The project is anticipated to create 600 construction jobs.

EIB vice president Jonathan Taylor said: “Our strong partnership with SSE over many years demonstrates our firm commitment to support ambitious energy investment that creates jobs and benefits local companies.”