The European Bank for Reconstruction and Development (EBRD) has agreed to provide a loan of €149m (£136.7m) for state-owned operator Ukrenergo to upgrade its electricity transmission network.
Ukrenergo will use the financing to upgrade its key transmission infrastructure needed for synchronisation with the European electricity networks. It will also support the country in aligning its legal framework and operational practices with the EU 3rd Energy Package.
EU 3rd Energy Package is a legislative package for internal gas and electricity market, whose purpose is to open up the gas and electricity markets in the region. It came into force in September 2009.
The 15-year sovereign-guaranteed loan provided by the EBRD will help in acquiring up to 26 new transformers and to carry out automation and upgrade of 12 high-voltage substations across key locations in the Ukrainian transmission network. The upgrades will also help in an annual reduction of CO2 emissions by 20,500 tonnes.
EBRD loan will help accommodate growing share of renewables in Ukraine
The loan will strengthen the utility’s capacity to accommodate the growing share of renewables to the country’s grid, which majorly includes wind and solar power.
The financial institution stated: “The EBRD financing is also promoting the commercialisation and institutional development of Ukrenergo through the implementation of a comprehensive Corporate Governance Action Plan and robust procurement standards.”
In February, EBRD and Black Sea Trade and Development Bank (BSTDB) offered financing for the construction of a 57.6MW solar plant in Ukraine. The solar plant, which could generate up to 65,000MWh of renewable energy could help in offsetting nearly 40,000 tonnes of CO2 emissions annually.
EBRD and BSTDB had agreed to provide €19.1m (£17.5m) each to Ingulets Energo – 2, a specially created project company.
The investment to the solar project is implemented under the EBRD’s €250 million Ukraine Sustainable Energy Lending Facility III (USELF III) framework.
