The European Investment Bank (EIB) is lending 300 million euros (US$448.7 million) to Spanish utility Iberdrola to help finance three pumped-storage projects as expansions of existing hydro plants.
Officials of the European Union's bank and the hydropower operator signed an agreement November 13, 2009, to finance half the estimated 600 million euro (US$896.7 million) cost of the 177-MW San Esteban 2 and 25-MW San Pedro 2 projects on the Sil River in Ourense Province and the 852-MW La Muela 2 project on the Jucar River in Valencia Province.
"In line with the EU energy policy, the EIB supports projects meeting the threefold objective of increasing energy efficiency, improving the security of supply, and fostering clean energy," EIB Vice President Carlos da Silva Costa said.
Iberdrola has been expanding existing hydroelectric projects for pumped storage to support the development of intermittent renewables generation such as wind power. (HRW June 2009) The existing projects are 263-MW San Esteban, 33-MW San Pedro, and 635-MW La Muela.
Iberdrola is expected to issue solicitations for equipment and civil works under EIB procurement rules. The investment mainly concerns electro-mechanical equipment such as turbine-generators and transformers and underground civil works such as water intakes, penstock tunnels, and powerhouse caverns. None of the work would enlarge dams or transmission lines or increase inundation.
In August, Voith Hydro announced it received a US$34.1 million contract to supply a Francis turbine, vertical generator, and 32-meter-long steel liner for San Esteban 2. (HydroWorld 8/19/09) In 2008, Iberdrola awarded a US$57.3 million contract to Voith to supply four pump-turbines and spherical valves for La Muela 2. (HydroWorld 7/15/08)