ZAGREB, Croatia 12/6/11 (PennWell) -- The European Bank for Reconstruction and Development (EBRD) is giving Hrvatska Elektroprivreda (HEP) a loan worth US$166 million for construction of the Ombla hydropower plant.
The 68-MW hydroelectric facility will not only improve Croatia's energy security, it also will increase the supply of potable water to the city of Dubrovnik, EBRD says.
The bank will work closely with HEP to ensure that the project complies with Croatian environmental standards and other directives established by the European Union. The proceeds of the EBRD loan will not be disbursed until HEP has completed a satisfactory study and biodiversity management plan.
"While recognizing the technical and environmental challenges the project entails, we also believe the project is important to further develop Croatia's renewable energy generation capacity," says EBRD Director for Power and Energy Utilities Nandita Parshad. "We are committed to ensuring the project is implemented in line with our agreed Environmental and Social Action Plan."
The loan is structured under the EBRD's A/B loan scheme and stipulates that financing to HEB includes US$108 million for the bank's account, with the remaining $58 million to be syndicated to commercial banks.
HEP took bids for the 130-meter-tall, run-of-river project in June 2011.
"We are sure that this project has the potential of a significant economic contribution," said Leo Begovic, President of HEP's Management Board.