The funding will be deployed at Renault’s facilities in France, where it will be used to develop the group’s electric vehicle expertise, establish new processes and bring down the price of the technology to speed up its mass-market adoption. In addition to the loan, the EIB will add value through its technical and financial knowledge.

It continues an ongoing partnership between EIB and Renault, following a €400m (£331m) Euro loan in 2009 which funded improvements in conventional engine technology and helped cover development costs for the manufacturer’s first electric vehicles, which go on sale this year.

The EIB has also pledged investment to help support the development of more efficient transport in Europe, in line with a European Commission White Paper issued last March.

Speaking at the signing ceremony, held at Renault Group’s headquarters in Boulogne-Billancourt, EIB Vice-President Philippe de Fontaine Vive, said: ‘We support leading-edge technologies since they shape the future in terms of sustainable development and competitiveness.

‘This cooperation will enable us to prepare together the future of the motor industry in Europe, whose citizens will be the first to benefit in their day-to-day lives.’