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Kosovo to expand its wind capacity with 57.5 mln euros EBRD loan

Kosovo, a country heavily reliant on coal, took a major step towards the decarbonisation of its electricity sector with the help of a 57.5 million euros loan from the European Bank for Reconstruction and Development (EBRD) to finance the construction and operation of a 105 megawatts (MW) wind farm in the North of the country. Once put into operation the new Bajgora project will be the biggest wind park in Kosovo and a source of clean and reliable energy for the country, that aims to significantly expand its renewables capacity in the next five years.

The 57.5 million euros EBRD loan is half of the total required financing for the project, with a further 50 per cent being provided by Erste Group Bank and NLB Bank. The Bajgora wind farm project belongs to Sowi Kosovo, majority-owned and controlled by Enlight Renewable Energy, an Israeli renewable energy producer.

The Bajgora wind park will be the largest generation project constructed in Kosovo since the 1980s representing a major step forward in Kosovo’s energy transition. When completed it will represent about 10 per cent of the country’s installed capacity and avoid 247,000 tonnes of CO2 a year.

The EBRD financing follows three years of policy engagement with the Kosovar authorities to refine the renewable offtake framework. These reforms were critical to unlocking financing for renewable projects and are expected to attract significant investor interest to Kosovo.

Kosovo’s electricity operating capacity is about 900 MW, almost all of which comes from two coal-fired power plants, Kosovo A and Kosovo B, infamous for their contribution to air pollution and considered to be the biggest emitters in the Western-Balkans region.

Earlier this year, the American contracting company has halted plans to build the 500 MW new coal-fired Kosova e Re power plant, that would have satisfied around half of the electricity demand.

The country’s current energy strategy sets an ambitious target of introducing about 401-470 MW of renewable projects by 2026, depending on the development scenario. More renewable energy will help address both the challenge of power cuts and pollution caused by the lignite coal powering Kosovo’s two existing main electricity plants.

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