The EBRD is making a loan of €170 million to Turceni, the largest lignite-fired power plant in Romania, to support its drive towards greater energy efficiency and competitiveness.
The financing for the improvement and modernisation of one power generation unit at Turceni will reduce harmful greenhouse gas emissions and bolster its position in an increasingly competitive energy market.
The project, estimated at a total cost of €224 million, will finance the design, procurement, commissioning and installation of equipment necessary for the upgrades of Unit 6. Once completed, the modernised unit will be ranked among the least carbon intensive such plants in Europe, thus enabling it to comply with the existing EU environmental standards.
The loan was oversubscribed, allowing the EBRD and Turceni to increase the financing from €150 million to € 170 million. The EBRD will retain €80 million with €70 million to be syndicated to a group of commercial banks, consisting of Erste Bank, Societe Generale, UniCredit and Intesa Sanpaolo. The Black Sea Trade and Development Bank (BSTDB) will offer a parallel loan of €20 million. The additional project costs will be covered from Turceni’s own funds.
Successful reforms and liberalisation of the power market have contributed to Romania becoming a recognised leader in this field in the region.
“The EBRD’s support for Romania’s further efforts to reform and improve the energy sector will help address the country’s urgent investment needs in this area. The level of commitment shown by lenders in the current financial climate is impressive. It will help Turceni make cost-effective gains in efficiency and strengthen best commercial practices, improving its competitive position on the Romanian and regional markets,” said Riccardo Puliti, EBRD Energy Business Group Director.
“This financing of the rehabilitation and modernisation of Turceni’s unit 6 is important for Romania and is part of the Ministry’s broader programme to support its energy companies in raising funds from the financial markets”, said Adriean Videanu, Minister of Economy.
Established in 2003, after the break up of the vertically integrated monopoly Renel/Conel, Turceni has a total installed power of 2,310 MW and three lignite mines.
Since the beginning of its operations in Romania the EBRD has committed over €4.2 billion across more than 255 projects, which attracted additional investment of over €7.4 billion.