The European Commission has announced almost €4m in funding for a feasibility study on an electricity inter-connector that would link Ireland and France.
The two countries are currently unconnected with regard to energy infrastructure.
If the feasibility study were successful, Ireland and France would have a long-distance electricity inter-connector via a subsea cable.
The study is part of an agreement by EU member states to allocate €150m to key trans-European energy infrastructure projects.
The results of the feasibility study are due from mid-2016, at which point a decision will be made on whether or not to proceed with the Celtic Interconnector.
The bulk of the support will go to projects in Central Eastern and South Eastern Europe as well as to projects in the Baltic region.
In total, 20 projects were selected following a call for proposals under the Connecting Europe Facility (CEF), an EU funding programme for infrastructure.
It is hoped the selected projects will increase energy security and help end the isolation of member states from EU-wide energy networks.
State-owned electricity grid operator EirGrid has welcomed the announcement of funding for the feasibility study.
EirGrid Chief Executive Fintan Slye said: “An interconnector with France is the strongest prospect after an interconnector with Britain, which we have already constructed."
Minister for Communications, Energy and Natural Resources Alex White said the announcement as a welcome endorsement of EirGrid's work towards interconnection.
He added: "Interconnection is a key EU target in the energy sector and is particularly important for countries with fewer land borders such as Ireland."