The state-owned company Elektkromreža Serbia (EMS) signed an agreement on a loan for the construction of a part of Trans-Balkan corridor Kragujevac-Kraljevo with the German bank KfW.
The loan agreement which will provide EUR 15 million for the second section of the first phase of the Trans-Balkan corridor construction through Serbia was signed by Jelena Matejić, the acting director of EMS, Aleksandar Antić, the minister of mining and energy and the representatives of KfW.
The loan repayment period is 12 years including the grace period of three years. The loan will be repaid in semi-annual installments at the interest rate of 0.8 percent per annum. The deadline for the withdrawal of the loan is June 30, 2020, while the commitment fee is 0.25%. The loan guarantees are provided by the Government of Serbia.
An agreement on a donation of EUR 6.5 million under the Investment Framework for the Western Balkans (WBIF) was also signed. The remainder of the needed funds will be provided by EMS.
“Without the aforementioned funds EMS could not alone finance Trans-Balkan corridor which is a project of enormous state, regional, and European importance,” said Matejić and added that she hopes that the company will have the support of the Federal Republic of Germany and the European Union (EU) in the future too.
Michael Davenport, Head of EU Delegation in Serbia, and Axel Dittmann, the German Ambassador to Serbia, also attended the ceremony.
The second section of the first phase of the Trans-Balkan corridor construction in Serbia involves the raising the transmission grid in Central and Western Serbia to the 400 kV voltage level. The average age of equipment installed on the 220 kV transmission network in these parts of Serbia is 50 years, which is why it needs to be replaced.
The construction of the Kragujevac-Kraljevo 400 kV transmission line, the extension of 220/110 kV Kraljevo 3 to 400 kV as well as the unfolding of a new 110 kV voltage level contribute to improving voltage conditions in the South-Western Serbia network, especially in the region of Novi Pazar and Raška, read a press release published by EMS.
The total length of 400 kV transmission lines planned to be constructed in the first phase of the Trans-Balkan corridor project over the next ten years is around 320 km, of which almost 260 km are so-called double 400 kV transmission lines. The increase in the installed capacity in substations on the corridor in the first phase of implementation is about 1200 MVA while a total estimated budget for the first phase of the Trans-Balkan corridor construction project is around EUR 160 million.