PRISTINA (Reuters) - The European Bank for Reconstruction and Development will lend 58 million euros ($63.93 million) to finance Kosovo’s biggest wind farm, it said on Monday, more than doubling renewable energy capacity in the heavily coal-reliant country.
The EBRD said the new 105-megawatt Sowi Kosovo wind farm project in Bajgora, northern Kosovo, which is being developed by Israel’s Enlight Renewable Energy, will take the country’s installed renewable energy capacity beyond 200 MW.
At the moment around 90% of Kosovo’s electricity is produced by two ailing coal-fired plants, Kosova A and Kosova B, which are among Europe’s worst polluters. The lender said the new project will cut emissions.
“When complete, Bajgora will represent about 10% of the country’s installed capacity and avoid 247,000 tonnes of CO2 a year, making a significant contribution to climate change mitigation,” the EBRD said in a statement.
The EBRD loan will cover only half the total construction cost, with the other half covered by other lenders.
Kosovo aims to achieve generating capacity from renewables of 400MW by 2026, including wind, hydro and sun. However, it is still planning to develop more coal-powered capacity.
In May this year Kosovo and London-listed power firm ContourGlobal picked a consortium of General Electric subsidiaries to build a 500 MW coal-fired plant in the country that is designed to meet nearly half of Kosovo’s power demand.
The deal needs to be voted on in parliament, but that was delayed following a snap general election in October.
Despite having 14 billion tonnes of reserves of lignite, the fifth largest in the world, Kosovo was told by the European Union to invest more in clean energy and possibly phase out coal as an energy source.
Enlight has previously said that the 27-wind turbine farm is expected to bring annual revenue of 25 million euros for the first 12 years, and 15 million euros each year after.
The EBRD, which has invested some 413 million euros in Kosovo in 67 projects, said it aims to make 40% of its annual investments in the green economy by 2020.
($1 = 0.9073 euros)
Reporting by Fatos Bytyci; Editing by Jan Harvey