Kosovo, which largely relies on lignite for its electricity, will soon start benefiting from a cleaner supply of energy from the biggest wind farm in the country thanks to a €58m loan from the European Bank for Reconstruction and Development (EBRD).
The loan will cover about half the cost of construction and operation of the 105 MW Bajgora wind farm in the north of the country. The remaining funds will be provided by Erste Group Bank and NLB Bank, both benefiting from cover provided by the German export credit agency Euler Hermes.
When complete, Bajgora will be the largest electricity plant constructed in Kosovo since the 1980s and represents a major step forward in Kosovo’s energy transition. More renewable energy will help address the twin challenges of reducing power cuts and avoiding pollution caused by the coal powering Kosovo’s two existing main electricity plants.
This investment follows three years of EBRD work with the government to make legislative reforms to unlock project financing of renewables in the country. Once constructed, the project will take Kosovo’s renewable installed capacity beyond 200 MW and give a significant boost towards achieving the 400 MW target the country has set itself to reach by 2026.
The funding for the Bajgora wind farm will enable its owners, Sowi Kosovo LLC, to build and operate a wind farm in the Mitrovica municipality. Sowi Kosovo LLC is majority-owned and controlled by Enlight Renewable Energy Ltd, an Israeli renewable energy company and existing client of the EBRD, alongside its German and Kosovan partners.
“We are delighted to be partnering again with Enlight and our co-financiers to support this landmark project. It is great to see a country that has relied for so long on lignite begin to exploit its renewable potential. The success of this project is a tribute to all involved, but especially the Kosovar authorities, who have built a contractual framework that can attract high quality international investors and lenders,” said Harry Boyd-Carpenter, Director for Energy EMEA at EBRD.
The EBRD is aiming to make 40 percent of its annual investments in the green economy by 2020.
This is the largest private sector project that the EBRD has signed in Kosovo to date. Altogether the EBRD has invested €413m in 67 projects in Kosovo.