Four key agreements for the realization of a new combined-cycle cogeneration unit in EL-TO Zagreb were signed today at the headquarters of Hrvatska elektroprivreda. HEP d.d. signed the Loan Agreement with the European Bank for Reconstruction and Development (EBRD) and the Loan Agreement with the European Investment Bank (EIB) as well as Engineering, Procurement and Construction Contract and Long-term Service Agreement with the company FATA S.p.A. (member of the Danieli Group) from Italy.
On behalf of EBRD, Loan Agreements were signed by Vedrana Jelušić Kašić, EBRD Director for Croatia, Slovenia, Hungary and Slovakia and on behalf of EIB by Miguel Morgado, the Head of EIB Division Adriatic Sea and Branko Čevriz, Legal Counsel at EIB, South-East Europe division. On behalf of HEP, Loan Agreements were signed by Frane Barbarić, the President of the Management Board. Engineering, Procurement and Construction Contract (EPC) as well as Long-term Service Agreement (LTSA) were signed by Frane Barbarić, the President of the Management Board of HEP d.d. and Andrea Lombardi, the President of the Management Board of FATA S.p.A. The signing of the agreements was attended by Tomislav Čorić, the Minister of Environment and Energy and Adriano Chiodi Cianfarani, the Ambassador of the Italian Republic to the Republic of Croatia.
“This project will be excellent in all ways – ecologically friendly owing to state-of-the-art systems and measures of environment protection, reliable for heat energy supply of customers in the City of Zagreb and as electricity source for the Croatian power system. Above all, it will be a highly effective and energetically efficient because in the simultaneous generation of electricity and heat energy its fuel efficiency will amount to 90 percent”, said Frane Barbarić, the President of HEP’s Management Board at the signing ceremony.
The total value of both Loan Agreements amounts to EUR 130 m, in which EBRD and the syndicate of commercial banks ensure EUR 87 m, and EIB EUR 43 m. Guarantees for funds from EIB's loan were provided by the European Fund for Strategic Investment (EFSI), the main holder of the Investment Plan for Europe, initiated by the European Commission (“Juncker Plan”). “This innovative operation supported by the EIB, the Investment Plan for Europe and the EBRD will improve the quality of life of the citizens of Zagreb by reducing pollution levels and ensuring 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.”, said EIB Vice President Dario Scannapieco.
The new highly effective unit of CCPP EL-TO Zagreb, with electrical output of 150 MWe and heat output of 114 MWt is going to use only gas fuel and is going to be ecologically friendly and a reliable support for supplying Zagreb with heat energy as well as a reliable electricity source for the Croatian power system. The new cogeneration unit (for simultaneous generation of electricity and heat energy) is going to replace a part of old and worn-out units at the EL-TO site in Trešnjevka, a Zagreb neighbourhood. “We are pleased to join forces with the EIB and the Investment Plan for Europe to deliver this investment, which is vital for Zagreb and the city’s population. The EBRD has a strong track record in progressing towards green energy and this is yet another important step in this direction.”, said Vedrana Jelušić Kašić, EBRD Regional Director, Croatia, Slovenia, Hungary and Slovak Republic
The tender for construction and equipment procurement and installation (EPC Contract) as well as for concluding a long-term service agreement (LTSA) was conducted in line with EBRD's rules. Permits for project realization have been obtained in the preparatory phase of the project and currently preparatory activities at the location of the future plant are in progress. Construction works for the plant should be completed by the end of 2021. “FATA is proud to cooperate with HEP for the design and construction of this important power plant for the Municipality of Zagreb. The District Heating is nowadays considered the most effective technology to provide heat and electricity, reducing emissions and environmental impact in general, further to optimize the generation costs. It is FATA commitment to accomplish the project in compliance with high quality standards for equipment and construction”, said Andrea Lombardi, Chairman & CEO, FATA S.p.A.
In accordance with energy efficiency guidelines, which are an integral part of the strategic energy documents of the EU and Croatia, CCPP EL-TO Zagreb will achieve significant savings in primary energy and will reduce specific CO2 emissions as well as emissions of flue gases per generated kWh (kilowatt hour) of energy at the EL-TO site. “As the EU transitions to a cleaner and more sustainable economy, it is crucial that we replace older, polluting power plants with climate-friendly versions. This is precisely what this project will do: generate electricity for residents of Zagreb in a more sustainable way. With financing support from the European Investment Bank under the Investment Plan for Europe, as well as from the EBRD and national power company Hrvatska Elektroprivreda, this is a collective effort to modernise energy supply in Croatia and contribute towards the EU’s climate goals”, said Jyrki Katainen, European Commission Vice-President for Jobs, Growth, Investment and Competitiveness.