Croatian CHP Gets European Bank Loans

The European Bank for Reconstruction and Development (EBRD) and the European Investment Bank (EIB) are lending €130mn ($152mn) to Croatia for new gas-fired generation, they said July 24. "The EBRD has a strong track record in progressing towards green energy and this is yet another important step in this direction," it said. The EIB loan (€43mn) is guaranteed by the so-called Juncker Plan.

The loan proceeds will be used for the installation of two low-NOx gas turbines, two heat recovery steam generators and one back pressure steam turbine producing heat and electricity at the Elektrana-toplana combined heat and power (EL TO CHP) plant close to the centre of Zagreb. The capacity of the new combined-cycle gas turbine units will be 150 MW of electrical energy and 114 MW of thermal energy, with lower greenhouse gas emissions, the lenders said.

The gas-fired plants will replace obsolete, mostly heat-only, gas and oil-fired units and the investment will ensure implementation of a modern and environmentally friendly project satisfying the heating requirements of the city and all national and EU environmental standards, they said.

The project will be implemented at Elektrana-toplana Zagreb, a power plant fully owned and operated by state-run Hrvatska Elektroprivreda (HEP). The EIB loan will be guaranteed by the European Fund for Strategic Investments (EFSI), which is the central pillar of the Investment Plan for Europe (“Juncker Plan”). The EFSI support makes it possible to provide loan conditions aligned to the economic lifetime of the financed asset and is expected to act as a catalyst in bringing in private sector banks, they said.

EIB said the result would be better air quality for Zagreb and reliable supply to the city’s district heating network. It will help reach efficiency targets and provide a source of electricity from highly efficient cogeneration. By capturing the heat from the generation process, efficiencies of CHP plants can be 90%, HEP said.

The European Commission said: "It is crucial to replace older, polluting power plants with climate-friendly versions. This is precisely what this project will do.... With financing support from the European Investment Bank under the Investment Plan for Europe, as well as from the EBRD and national power company, this is a collective effort to modernise energy supply in Croatia and contribute towards the EU’s climate goals.”