OSLO, Norway 10/18/11 (PennWell) -- The Nordic Investment Bank (NIB) and Norway's Sparebanken Vest have approved a 500 million kroner (US$88.9 million) loan for construction and upgrade of small hydropower projects in Norway.
NIB, the international financial institution of eight Nordic and Baltic countries, lent US$70 million in March for the 80-MW Budarhals hydroelectric project in Iceland.
In the latest transaction, NIB is providing a 10-year-maturity loan to finance Sparebanken Vest's new loan program for construction of new and upgrading of existing small hydropower projects from 2010-2013 within Sparebanken Vest's market in western Norway.
Due to the limited possibility of building new large hydro projects in Norway, the banks said the potential for increased energy production lies in small hydropower stations.
"Financing smaller projects through Sparebanken Vest is an efficient way for NIB to reach small energy companies in Norway," NIB President Johnny Akerholm said. "Hydropower is a clean energy source, and increasing the output from existing hydropower plants is among the most sustainable ways of generating electricity."