Provision of a senior long-term loan to finance the construction of a 32.4MW KITKA wind farm located in the Kamenica Municipality in Eastern Kosovo (the "Project"), the first wind farm in the country. The project will be implemented by Air Energy SH.P.K., a special purpose vehicle established for the purpose of the project and fully-owned by Guris Insaat ve Muhendislik A.S, a company which is part of the Turkish engineering and construction conglomerate Guris Group.
The project will contribute to climate mitigation by increasing the share of renewable energy generation in Kosovo and add 32.4 MW of wind generation capacity to the national energy system. The project will be the first wind farm in Kosovo, which is otherwise largely reliant on coal-fired power generation.
The project will add 32.4 MW of renewable capacity, supporting the "green" transition quality. This will contribute to the reduction of CO2 emissions in the country.
AIR ENERGY SHPK
The borrower is a special purpose vehicle incorporated in Kosovo for the purpose of developing, constructing and operating the project.
EBRD Finance Summary
Total Project Cost
Environmental and Social Summary
Categorised B (2014 ESP). Environmental and social (E&S) due diligence has shown that the E&S issues associated with an already operational 32.4MW wind power project in eastern Kosovo are site specific and readily addressed through the implementation of sector-specific mitigation and monitoring measures. An E&S action plan has been agreed with the Client to structure the Project in line with the Bank's requirements. The Project became operational during October 2018. The Project is expected to avoid 81,000 tons of CO2e per year.
E&S due diligence was conducted by the EBRD and an independent biodiversity consultant during the later stages of construction and early operation. The due diligence considered the main project site, which includes nine wind turbines, a control room building, substation, underground cables and access roads, as well as associated facilities, including a main access road and a 14.5km 110Kv transmission line. The turbines have been installed in a mountainous grassland area and while forest areas are presented the turbines are located away from such areas. The access road involved the upgrade of an existing track. The transmission line crosses forested and agricultural areas and generally follows the access road. The transmission line has been transferred to the Kosovo Electricity Distribution and Supply Company.
The Project has been fully permitted in terms of national legislation based on national EIA documents. The Project is located near to an international border and while significant transboundary impacts are not expected having information and a grievance mechanism accessible online in appropriate languages allows for wider distribution of information beyond the Project area.
The Project further has in place E&S management provisions, which will apply to the Project. The ESAP requires the formalisation of such provisions into an ISO aligned E&S management system and appointed of appropriate resources for implementation thereof. Human resources provisions are in line with PR2.
Due diligence confirmed a robust approach to pollution control and health and safety during late construction and this will continue during operation. Community health and safety impacts were considered in the national EIA process. The project is sufficiently distant to inhabited areas and therefore impacts such as shadow flicker and noise are not expected to be significant. This will be confirmed through monitoring, primarily with respect to noise. Visual impacts were discounted during the EIA process and were not raised as an issue by local communities. Various H&S provisions were put into place during the import of turbines to the site and during installation.
A review of land acquisition confirmed that land in the Project site was acquired through long term, negotiated leases. The grassland in the Project area is used for grazing of livestock and this practice will continue as will community access to the area. This includes access to a local spring. The direct project footprint, and loss of grazing land, is relatively small. The transmission line was subject to expropriation of land for the tower footprints and easements for the transmission line corridor. This process was conducted by the authorities and due diligence showed that landowners were appropriately compensated for land and for damage to crops. Where the transmission line crosses agricultural land, such agricultural practices can continue, while in forested areas a clear corridor is required. The transmission line route avoided houses and structures and no physical resettlement was required. The land affected by is relatively small compared to land parcel sizes. The ESAP requires the Project to monitor the status of land acquired for the transmission line through liaison with the authorities.
The Project is located distant to any protected or conservation areas. Understanding the Project environment was on the basis of literature reviews, a limited field survey and a site visit by the Bank's consultant. Significant environmental sensitivities, and significant collision risks to birds and bats, were not identified by the national EIAs but due to the absence of exhaustive surveys, it is necessary to further verify this through post construction monitoring, which will include monitoring in the field and carcass surveys using recognised methodologies and in line with PR6 requirements. Certain bird species known to be at risk from wind projects are known to be present in the wider area but are not expected to pass through the project site in significant numbers. No migration routes have been identified. Collision risk assessments will be revised over time and additional mitigation measures implemented if necessary. To reduce collision risks associated with the transmission line, the Project will install flight diverters in areas where higher bird numbers are expected. Further, a site reinstatement and monitoring plan is being implemented to reinstate areas affected by construction activities.
Community engagement and disclosure of information was conducted during the permitting process. The Project has a Stakeholder Engagement Plan (SEP) in place and this will continue to be implemented. Further the Project will be required to develop a Project website including information about the Project and contact details. EBRD will monitor the Project as required including site visits where necessary.
Technical Cooperation funds were provided by the EU under the Regional Energy Efficiency Programme for the Western Balkans ("REEP Plus") for the purpose of supporting the technical due diligence of the Project.
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