Provision of a secured project finance loan of up to EUR 9.75 millionto to an SPV incorporated in Albania and owned by Korporata Elektroenergjitike Shqiptare sh.a.("KESH"), the state-owned Albanian power generation company, for the construction of a floating solar PV plant on the surface of KESH's Vau i Dejes hydropower plant reservoir with an installed capacity of 12.9 MW. The electricity produced by the solar plant will be sold on the non-regulated electricity market.
The project will support the implementation of the first-of-a-kind floating technology solar plant in Albania and in the Western Balkans region and will promote the further use of the floating PV technology to increase the region's solar capacity through the efficient use of existing hydro reservoirs.
At the same time, the project will strengthen KESH's operational and financial performance through reduced reliance on hydro revenues and due to the floating technology's positive impact on the water levels of the existing reservoir.
ETI score: 65
The transition impact arises from delivering climate mitigation benefits through the construction of 12.9 MW of additional renewable energy generation capacity in Albania and by bringing a novel green technology to the country. The project will be built with minimal land utilisation and help reduce evaporation from water surfaces resulting in overall efficient use of resources.
In addition, the project will strengthen the financial resilience of the main state-owned utility company in the country.
KORPORATA ELEKTROENERGJETIKE SHQIPTARE SHA
The borrower will be a special purpose vehicle incorporated in Albania for the sole purpose of developing, constructing and operating the project. The borrower will be ultimately 100% owned by KESH.
KESH is a leading electricity generation company of Albania and the owner of the country's three major hydropower plants accounting for the majority of the domestic electricity production.
EBRD Finance Summary
Up to EUR 9.75 million secured project finance loan to be provided to the borrower.
Total Project Cost
The Bank is additional due to the offered financing structure and by providing risk mitigation. The EBRD offers terms and conditions and a tenor that are not available from commercial sources, but necessary to finance the project, while EBRD's existing relationship with KESH provides comfort to the client to invest in this new technology.
Environmental and Social Summary
Categorised B under the 2019 ESP. Environmental and social issues associated with the Project are anticipated to be localised, readily assessed, and mitigated based on an Environmental and Social Due Diligence (ESDD).
Key environmental and social (E&S) impacts/risks to consider on the Project include construction and operational impacts on water quality, aquatic and terrestrial biodiversity from the floating PV plant, the electrical connection to the substation at the nearby HPP and the launching site as well as potential impacts on other users of the reservoir (e.g. tourism; fishing etc). The proposed Project location within the reservoir is located within a proposed Key Biodiversity Area and thus compliance with PR6 will be a key area of focus.
The on-going ESDD is being undertaken by a consultant and includes a site visit to review the Project location and conduct biodiversity and social baseline data collection, a review of the permitting status of the Project and an assessment of the Client's E&S management capacity. This will include an assessment of any critical habitat or priority biodiversity features as appropriate. Based on the due diligence a Non-Technical Summary will be developed and disclosed in local language and English.
This PSD will be updated on the completion of the ESDD and agreement of an Environmental and Social Action Plan (ESAP) as well as Stakeholder Engagement Plan (SEP).
Technical Cooperation and Grant Financing
Total of EUR 165,930 TC funded by the Bank's Shareholder Special Fund ("SSF") for Environmental and Social Due Diligence, Commercial Due Diligence and Legal Due Diligence and EUR 74,920 TC funded by Austrian government (DRIVE Fund) for the Technical Due Diligence of the Project.
Company Contact Information
Benet Beci, CEO
+355 4 2259729
Rr. Viktor Eftimiu, Blloku Vasil Shanto, Tiranë, Albania
PSD last updated
30 Jul 2020
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Environmental and Social Policy (ESP)
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More information on the EBRD’s practices in this regard is set out in the ESP.
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The EBRD's Office of the Chief Compliance Officer (OCCO) promotes good governance and ensures that the highest standards of integrity are applied to all activities of the Bank in accordance with international best practice. Integrity due diligence is conducted on all Bank clients to ensure that projects do not present unacceptable integrity or reputational risks to the Bank. The Bank believes that identifying and resolving issues at the project assessment approval stages is the most effective means of ensuring the integrity of Bank transactions. OCCO plays a key role in these protective efforts, and also helps to monitor integrity risks in projects post-investment.
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Access to Information Policy (AIP)
The AIP sets out how the EBRD discloses information and consults with its stakeholders so as to promote better awareness and understanding of its strategies, policies and operations following its entry into force on 1 January 2020. Please visit the Access to Information Policy page to find out what information is available from the EBRD website.
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Independent Project Accountability Mechanism (IPAM)
If efforts to address environmental, social or public disclosure concerns with the Client or the Bank are unsuccessful (e.g. through the Client’s Project-level grievance mechanism or through direct engagement with Bank management), individuals and organisations may seek to address their concerns through the EBRD’s Independent Project Accountability Mechanism (IPAM).
IPAM independently reviews Project issues that are believed to have caused (or to be likely to cause) harm. The purpose of the Mechanism is: to support dialogue between Project stakeholders to resolve environmental, social and public disclosure issues; to determine whether the Bank has complied with its Environmental and Social Policy or Project-specific provisions of its Access to Information Policy; and where applicable, to address any existing non-compliance with these policies, while preventing future non-compliance by the Bank.
Please visit the Independent Project Accountability Mechanism webpage to find out more about IPAM and its mandate; how to submit a Request for review; or contact IPAM via email firstname.lastname@example.org to get guidance and more information on IPAM and how to submit a request.