Renewables

Enlight completes financing for wind power project Pupin in Serbia

Enlight completes financing wind power Pupin Serbia

Photo: Emilija Jovanović / Ministry of Mining and Energy

Published

March 26, 2024

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Published:

March 26, 2024

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Israeli renewables developer Enlight signed loan, offtake and balancing deals for its 94.4 MW Pupin wind power project in Serbia. Minister of Mining and Energy Dubravka Đedović Handanović said the facility, which has a contract for difference – CfD won at the country’s first wind power auction, would come online this year.

General Manager of Enlight EU Marko Lipošćak praised the stability and predictability of Serbia as an investment destination and its regulatory environment. Speaking at the ceremony where Israel-based Enlight Renewable Energy signed loan, offtake and balancing contracts today for its Pupin wind power project, he said the country is practical for green energy investments.

The 94.4 MW facility is under construction in Kovačica, north of Belgrade. It is named after Serbian world-famous scientist Mihajlo Pupin, who was born in the nearby village of Idvor.

Second offtake deal with EPS

All the energy that the power plant generates will be used within the country’s energy system, contributing to the security of supply, said Minister of Mining and Energy Dubravka Đedović Handanović. It is the second of the nine renewable energy projects that won market premiums in the form of contracts for difference at Serbia’s first wind and solar power auction to get a power purchase agreement, she noted.

Their combined capacity is above 700 MW and total investments will reach over EUR 1 billion, Đedović Handanović pointed out. She said the average price at the auctions was almost 50% lower than the market price. The minister added that the Pupin wind power plant would be connected to the grid this year.

The facility will come online before the end of the year, according to Minister Đedović Handanović

Director for the Western Balkans and Head of Serbia at the European Bank for Reconstruction and Development (EBRD) Matteo Colangeli highlighted the speed of execution of the investment. “We were mandated to work on this project on October 30 last year. That is less than five months ago. So I think it’s an incredible achievement, to be already at the financial closing stage,” he said.

Colangeli revealed it is the lender’s 354th project in Serbia since 2001. EBRD approved a senior secured loan of up to EUR 42.9 million and debt service reserve facility in the amount of EUR 2.8 million.

The other lender, Erste Bank Serbia, provided a package of the same size, according to the EBRD. Nikola Stamenković, member of its executive board, recalled that it also financed Kovačica. So did the European Bank for Reconstruction and Development. Pupin is Erste’s fifth wind power project in Serbia.

Superfast development of Pupin wind power project

The project firm, called Enlight K2-Wind, is majority-owned by Enlight Renewable Energy. It is listed on the Nasdaq in New York and the Tel Aviv Stock Exchange. Total project cost is EUR 163.6 million, EBRD said earlier. In the Balkans, the company is also active in Croatia and Kosovo*.

Pupin was developed in cooperation with local partner company New Energy Solutions. Its Chief Executive Officer Miloš Colić claimed the process was “superfast”. It took five years to get to financial closing, he underscored. In Europe, the average is seven years, the CEO asserted.

The company obtained the construction permit in 2021 and works started last year. Enlight and New Energy Solutions built the Kovačica wind farm together in 2019. The new facility, with 16 turbines, is next to it.

Enlight signed a power purchase and balancing agreement with Elektroprivreda Srbije (EPS). Acting Director Dušan Živković said at the event that Serbia’s state-owned power utility would offtake the entire output for 15 years. EPS is purchasing it “according to market principles,” he stressed.

The Israeli developer got a CfD for 68 MW out of the overall 95.5 MW at EUR 68.88 per MWh.

* This designation is without prejudice to positions on status and is in line with UNSCR 1244/99 and the ICJ Opinion on the Kosovo declaration of independence.
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