Kovacica Wind Farm

Country:

Serbia

Project number:

48762

Business sector:

Power and energy

Notice type:

Private

Environmental category:

A

Target board date:

05 Jul 2017

Status:

Signed

PSD disclosed:

05 Apr 2017

Translated version of this PSD: Serbian

Project Description

Provision of a senior secured loan of up to EUR 50 million to Electrawinds K-Wind d.o.o. to finance the construction, commissioning and operation of the 104.5MW Kovacica wind farm consisting of 38 wind turbines each with capacity of 2.75 MW and including a 220/33-35 KV substation (the "Project") located 50km northeast of Belgrade, Serbia.

Project Objectives

Kovacica Wind Farm will be among the first privately owned wind farms in Serbia and will help diversify Serbian power sector which is dominated by conventional thermal and hydro-power generation.

Transition Impact

The Project will be among the first large scale wind farms in Serbia to reach commercial operations and thus has the potential to have a strong demonstration effect. It will also demonstrate the role of the private sector in power generation, being among the first privately-owned power plants in Serbia. Furthermore, the Project will assist Serbia in diversifying its power sector, which is heavily concentrated on thermal and hydro-power generation.

Client Information

ELECTRAWINDS K-WIND D.O.O. BEOGRAD-NOVI BEOGRAD

Electrawinds K-Wind d.o.o. is a special purpose vehicle set up in Serbia currently owned by Solaveris Limited d.o.o and Enlight Renewable Energy Ltd. ("Enlight") through its subsidiary Blacklight Energies d.o.o. Prior to financial close the Project Company will be majority owned by Enlight with minority investments by several institutional investors.

Enlight Renewable Energy Ltd. is a public company listed on the Tel-Aviv Stock Exchange engaged in planning, development, construction and operation of renewable energy generation projects. It is part of the Eurocom Group, one of Israel's largest holding companies.

EBRD Finance Summary

EUR 40,000,000.00

Total Project will be financed through equity and up to EUR 140 million debt. Up to EUR 50 million will be provided by EBRD, with the balance provided by parallel commercial loans, which may benefit from cover from an Export Credit Agency such as Euler-Hermes or similar.

Total Project Cost

EUR 185,000,000.

Environmental and Social Summary

Categorised A (2014 ESP). The Project required an Environmental and Social Impact Assessment (ESIA) which was prepared for the project developer in 2013. An independent consultant was retained to undertake an Environmental and Social Due Diligence (ESDD) of the Project and to carry out a gap analysis for the ESIA disclosure package on behalf of the lenders. This due diligence concluded that the Kovacica Windfarm Project has been located and designed to minimise environmental and social impacts. The Project has been developed in compliance with local regulations and, with the careful application of the revised ESAP, the Project will meet the requirements of the EBRD environmental and social policy, including the EU EIA Directive and the EU Habitats Directive as applicable and transposed into Serbian legislation.

The ESIA assessed the impact of the wind farm on birds and bats that concluded that it will be low to medium. The project is not located in or near a Natura 2000 site or on a significant bird migration route. The Bank's consultant confirmed that the species list and range of movement has not changed substantially since the ESIA was published and that the bird and bat collision risk assessment remains appropriate for the project design and layout. There is no direct or indirect impact anticipated on any designated or identified nature conservation areas within 50 km, including the Deliblato sand protected area.

The site covers approximately 3,700 ha and is open cultivated farmland used for growing cereal crops. The footprint of the turbines will occupy around 4.5 ha in total. The land required for the electrical substation and the construction compound has been purchased by Electrawinds K-Wind (EKW) on a willing-buyer, willing-seller basis. The location of this substation was, in large part, dictated by the availability of a big enough land parcel from a single owner. The company took a similarly pragmatic approach to the micro-siting of the turbines; the final locations were determined by which landowners were willing to sign the proposed easement agreement. The financial compensation is in line with national land/ agricultural production valuations. The landowners were given a choice of receiving either an annual payment for the 25 year life of the wind farm or a one-off payment. The majority of landowners have accepted the one-off payment and to date no grievances have been raised on this issue.

An Environmental and Social Action Plan (ESAP) has been developed to set out specific environmental and social actions required to minimise impacts associated with the wind farm scheme. The ESAP has been developed to ensure compliance with Serbian regulation as well as the environmental and social requirements of the lenders. The key considerations include:

  • Prepare and submit reports on the status of ESAP implementation and environmental, health, safety and social performance, including resolution of grievances associated with the project;
     
  • Develop and implement an Environmental and Social Management System (ESMS);
     
  • Implement a monitoring programme to assess the impacts to birds and bats that may be occurring during the operational phase of the wind park;
     
  • Undertake a health and safety risk assessment of all staff job functions and activities and implement health and safety action plan covering control measures and work instructions as required; and
     
  • Develop and implement a decommissioning plan that includes a plan for minimising impacts during decommissioning.

This project is one of several wind developments proposed for this region of Serbia. EBRD is currently supporting an initiative jointly with IFC that is brings together project developers to identify potential cumulative impacts and develop options for mitigation measures.

There is an Environmental and Social Impact Assessment available for this project.

Technical Cooperation

Western Balkans Sustainable Energy Financing Facility: associated with this project is a capacity building technical cooperation sub-project which provided assistance for the finalisation of template PPAs in Serbia and Montenegro.

Company Contact Information

Milos Colic
miloc.colic@newenergy.rs
+381 11 7853 704
+ 381 11 7122 257
http://www.vpkovacica.rs/home.html
Djordja Stanojevica 14 11070 Belgrade Serbia

Business opportunities

For business opportunities or procurement, contact the client company.

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