The loan will be used to design, construct and operate the plant, which will have production capacity of 280MW heat and 130MW electricity.
After completion, the facility will provide heat to Stockholm’s existing district heating system and power to the city’s public grid.
The bank is also providing finance for the biomass handling facilities and the refurbishment of port facilities related to the plant.
Construction is anticipated to be completed by 2016 and the facility will create 35 new permanent jobs for operation and maintenance.
EIB vice-president responsible for lending in Sweden Jonathan Taylor said the new biomass plant will allow significant energy savings and contribute to climate neutral production of district heating in Stockholm.
"The project will also, importantly, contribute to growth and employment in the European Union by supporting the forest management and biomass equipment industry in Europe," Taylor added.
Fortum Värme chief executive Anders Egelrud said the company is contributing to a sustainable city by constructing the future energy system for Stockholm.
"Our new CHP is beneficial for the whole of Europe as the renewable electricity produced will reduce electricity production based on fossil fuels in continental Europe," Egelrud added.
"When the plant is in operation, 90% of our heat and electricity production will be based on renewable and recovered energy. By 2030 at the latest, this ratio is expected to be 100%."
Image: The facility will provide heat to Stockholm’s existing district heating system and power to the city’s public grid. Photo: Courtesy of European Investment Bank/Fortum.
