Published: June 6, 2011
Two power plants to be built following €34.4mn loan.
Renewable energy generation in the Baltics is set to increase after Graanul Invest, an Estonian wood pellet producer, secured a loan worth €34.4mn from the European Bank for Reconstruction and Development (EBRD).
The loan will fund the construction of two biomass-fuelled combined heat and power plants. The sites will be built in Estonia and Latvia and each have the capacity to generate 6.4MW of electricity and 15MW of heat.
The financing will also be used to improve the energy efficiency of Graanul Invest’s pellet plants.
Nandita Parshad, the EBRD’s director for power and energy, said promoting renewable energy generation is one of the bank’s priorities in the Baltics.
“This project will diversify the domestic power generation mix of Estonia and Latvia and will set an example of successful business in green energy,” she added.
Raul Kirjanen, Graanul Invest’s chief executive, said the funds are an important part of implementing the company’s expansion strategy and making its operations more efficient.
This loan follows a Baltics’ power sector investment by the EBRD early last year when it lent €71mn to AB Lietuvos Elektrine to build a new combined cycle gas turbine plant in Lithuania, reducing the country’s greenhouse gas emissions. The project replaced the power generation capacity that was lost following the closure of the Ignalina Nuclear Power Plant, which accounted for more than 70% of the country’s electricity output.
The EBRD supports climate change initiatives and aims to increase energy efficiency through its Sustainable Energy Initiative. It was launched in 2006 and to date has invested €6.6bn in 369 projects in 29 countries.