EBRD approves funds for Krnovo wind power plant
The European Bank for Reconstruction and Development (EBRD) is supporting the first commercial wind power plant in Montenegro, to be located at Krnovo, near the town of Nikšić in the western part of the country. Also, the government in Podgorica agreed on July 23 for French development bank of Proparco to join the project lenders.
The consortium of Akuo Energy from France and Ivicom Consulting from Austria needs additional funds for the project worth between EUR 100 million and EUR 120 million, the government said. Because of the inability to obtain financing from commercial banks, the investor started negotiations with the representatives of the EBRD and German KfW Development bank, the press release said, according to a report by agency MINA-Business, published by Vijesti newspaper’s portal.
EBRD said on July 8 it is extending a senior secured loan of up to EUR 48.5 million to Krnovo Green Energy DOO, the subsidiary of Akuo Energy of France, which will build and operate the 72 MW plant. In parallel, KfW IPEX-Bank GmbH, a subsidiary of KfW Development Bank of Germany, is providing a loan of the same amount. The official start of construction works was in May.
This is the first large-scale investment in the country’s electricity generation capacity since the 1980s, the report said. Once constructed and operational the wind farm will represent 8% of the total installed capacity and 6% of total electricity production in Montenegro. The project is expected to result in CO2 emission reductions of more than 180,000 tons annually, equivalent to removing 11,000 cars from the roads, EBRD said.
„With this project, the EBRD is supporting Montenegro in becoming one of the lowest-carbon economies in Europe on a relative basis and advancing energy efficiency by boosting competition in Montenegro’s energy market. Over the last two years the EBRD has worked with the government to create the regulatory framework for renewables,” said Giulio Moreno, head of EBRD’s Podgorica office. The bank will also finance the construction of a mini hydropower plant on Bistrica river in Bijelo Polje, in the country’s north, Moreno said in June.
“Montenegro is a country that lies at the crossroads of Europe, has considerable renewable resources and has decided to make even greater use of these resources to have production of green electricity – a strategic priority for its development. We welcome this proactive policy and are delighted to have financed the country’s very first wind farm with the help of EBRD, KfW IPEX-Bank, and Proparco,” concluded Eric Scotto, Akuo Energy’s cofounder and CEO.