The European Investment Bank (EIB) has announced a plan to finance UkrHydroEnergo's hydroelectric modernization and upgrade program with a loan worth US$257 million.

EIB's loan will support the refurbishment and upgrade of 22 conventional and pumped-storage generating units at six hydropower stations along the Dnieper River in central Ukraine.

When finished, the plants will have a total combined capacity of 980 MW, or about 10% more than the current capacity.

"This is the first EIB-financed project in Ukraine contributing to increasing the share of electricity generation from renewable sources," says Anton Rop, EIB Vice-President. "This will contribute to the reduction of alternative fossil fuel consumption, implying a significant decrease in CO2 emissions and help Ukraine to meet its climate change commitments."

The project is being co-financed by the European Bank for Reconstruction and Development (EBRD), which announced its plan to fund a pair of small hydropower plants in Albania earlier this week.

Technical assistance to support project implementation will be funded by the Neighbourhood Investment Facility.