The Nordic Investment Bank (NIB) has made an $82m (€67m) loan to Swedish energy company Vaxjo Energi to finance its investment in a new combined heat and power plant.

The loan has a 20-year maturity, and will partly finance the new CHP plant in the southern Swedish city of Vaxjo. The new plant will be totally bio-fuelled, and additional renewable power will be generated, reducing emissions.

“NIB is pleased to participate in a project that contributes to the replacement of fossil fuels with biofuels, which is in line with our mission to promote sustainable growth. Due to this project, the use of fossil fuels will diminish in Växjö Energi’s power production,” says Henrik Normann, NIB President and CEO.

Vaxjo Energi AB is an energy company fully owned by Vaxjo Municipality. The company produces and distributes district heating, cooling and electricity, and is responsible for the expansion of the district and local heating in the region. The loan to Vaxjo Energi is financed under NIB’s Climate Change, Energy Efficiency and Renewable Energy Facility (CLEERE).

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