The Government and business leaders have welcomed the confirmation that the European Commission is to invest €530 million in the new Celtic Interconnector.

The €1 billion underwater connection will link Ireland with Europe's energy grid via France.

Once built, it will have the capability to power 450,000 households.

This will help Ireland to switch to 70% renewable energy, the Government says, as well as drive down electricity prices.

"This is a really significant investment for Ireland and will help us to conduct a magnificent feat of engineering," the Taoiseach said.

"The Celtic Interconnector will help to lower electricity prices, reduce greenhouse gas emissions and provide greater energy security."

"It's a direct result of our close working relationship with the European Commission including President Juncker, and France and President Macron, who will be our closest EU neighbours following Brexit.

"It’s a signal of European solidarity at this crucial time."

The connection will ensure that Ireland will have a direct energy link to the EU after Brexit.

"Increased investment in our grid infrastructure will be critical if we are to improve our energy security into the future," said Chambers Ireland Chief Executive Ian Talbot.

"Not only will the Interconnector improve the resilience of our energy supply, it is also a strategically important investment, enabling more efficient access to the EU's Internal Energy Market post-Brexit."

"Today's announcement represents a significant milestone in the ongoing transition to a more integrated and sustainable European energy system," said Fergal O'Brien, Director of Policy and Public Affairs at Ibec.

"Greater collaboration and interconnection with our European neighbours is crucial if we are to effectively combat climate change and deliver a low carbon energy system."

"The Celtic Interconnector will play a key role in helping us meet our 70% renewable electricity target by 2030 and is a project of significant common interest for Ireland and France."