The Estonian national railway infrastructure manager, Eesti Raudtee, and the European Investment Bank (EIB) signed a EUR 45 million loan to support projects for Estonia’s electrified rail network. The upgrades are due to be completed by 2030.
The Eesti Raudtee will use the EIB financing to upgrade the rail network and the associated infrastructure, increasing the share of the country’s rail network powered by electricity at the expense of existing diesel traction.
The project will improve rail connectivity for passengers across Estonia and green freight transport in the country. In addition to reducing emissions and bolstering safety, it will cut noise pollution.
“We have launched a very ambitious investment plan until 2030, which will take the quality and safety of our railways to a new level and help make rail transport even more environmentally friendly,” said Kaido Zimmermann, chairman of the Management Board of Eesti Raudtee.
The electrification of the final section near Tallinn, supported by the EIB loan, will enable Eesti Raudtee to complete its national electrification programme. Once finished, a total of 600 kilometres of railway, representing 50% of the network, will be electrified.
The EIB financing complements EU and national grants and offers flexible terms to accelerate implementation. It builds on a EUR 113.5 million EIB loan signed in 2020, bringing the bank’s total support for Estonia’s railway modernisation to nearly EUR 160 million.
The project is part of a key EU transport route known as the North Sea–Baltic TEN-T Corridor. It supports regional development and EU climate goals.
Following the implemented projects to increase the share of Estonia’s electrified rail network, this shift will help reduce greenhouse gas emissions that contribute to climate change. The planned works, which cover key sections of Estonia’s rail network, will also improve the safety and punctuality of train services and develop a transport management system that complies with European Union requirements.
“This investment is a strategic boost for Estonia’s rail infrastructure, making transport faster, cleaner, safer and more efficient. The loan agreement with Eesti Raudtee reflects how EIB financing drives climate action, strengthens regional connectivity and supports long-term resilience in cohesion regions,” said EIB Vice-President Karl Nehammer, responsible for operations in Estonia.
Eesti Raudtee develops and maintains 1,186 km of railway network, 61 stations, and 135 railway platforms. According to the 13th Annual Market Monitoring Report of IRG-Rail, 225 km comprises Estonia’s electrified rail network, representing 16% of the total.
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