EBRD and EU support Ukraine’s energy security with €75 million for hydropower

• EBRD lends €75 million to Ukrhydroenergo; loan supported by EU guarantee
• Finance is for procurement of essential equipment for hydro power plants
• Investment will enable 223 GWh of green electricity annually and cut emissions

The European Bank for Reconstruction and Development (EBRD) is providing a financing package to Ukraine’s state-owned hydropower company, Ukrhydroenergo (UHE), to secure critical equipment for its hydro power plants and reinforce the country’s energy resilience during wartime.

The package includes a senior loan of up to €75 million from the EBRD and up to €20 million in investment grants from international donors. The total project cost, including UHE’s own funds, is €120 million. The financing will cover the supply of critical equipment for hydro power plants, including the emergency reserve stock of electrical equipment, and the consultancy services for project implementation.

The EBRD’s loan is supported by an EU guarantee under its Ukraine Investment Framework (UIF), dedicated to unlocking financing for Ukraine’s recovery and long-term growth. The project falls within the EBRD-UIF HI BAR agreement signed in 2024. The UIF works to unlock financing for Ukraine’s strategic sectors, notably renewable energy.

This investment will enable UHE to replace damaged and worn-out components at selected hydro power plants, improving operational efficiency and increasing renewable energy generation. Once completed, the project is expected to deliver approximately 223 GWh of green electricity per year, reducing Ukraine’s reliance on electricity imports and strengthening its ability to meet peak demand. The initiative will also contribute to annual CO₂ savings of more than 96,000 tonnes.

The project aligns with the EBRD’s Resilience and Livelihoods Framework, supporting essential infrastructure under challenging conditions. It will also introduce a strategic training programme to address human capital gaps among UHE’s engineering staff, ensuring smooth integration of modern equipment and compliance with European standards.

All equipment procured will comply with EU environmental and safety standards, and activities will be implemented within existing facilities without land acquisition or displacement. The project is fully aligned with the Paris Agreement’s mitigation and adaptation goals and qualifies as 100 per cent green finance under the EBRD’s Green Economy Transition methodology.

The project will be supported by donor-funded technical cooperation assignments, including rapid capacity-building for procurement and a strategic new training programme for hydro power engineers and technical specialists. Additional programmes will focus on improving UHE’s ESG practices and developing a gender action plan, reinforcing the company’s commitment to sustainability and inclusion.

By backing this investment, the EBRD is helping Ukraine maintain a stable and secure energy system, accelerate its green transition, and strengthen resilience in the face of unprecedented challenges.

The EBRD has substantially increased its investments in Ukraine since Russia launched its full-scale war there in 2022, supporting energy security, vital infrastructure, food security, trade and the private sector, with 2025 looking set to bring the total deployed in wartime close to €9 billion. The Bank is Ukraine’s largest institutional investor.