Summary sheet
The project concerns the rehabilitation and modernisation of three key hydropower plants (HPP) in Ukraine (Kaniv HPP, Kremenchuk HPP and Dnipro HPP). The national name of the operation in Ukraine is: "Equipment Renovation for Hydropower Operational Stability and Reliability Improvement".
The aim is to significantly bolster the operational resilience of the country's electricity sector by implementing technical repairs and partial upgrades to the HPP, as well as by taking urgent emergency measures in response to the continued Russian military aggression on Ukraine's energy infrastructure.
The Project will enable the Promoter to re-establish and ensure safe and resilient operation of its existing hydropower assets.
The Project is fully aligned with the EU assistance to Ukraine within the context of war, namely with EIB's Ukraine Energy Rescue Plan prepared in consideration of the Bank's Energy Lending Policy (ELP) to support the EU Ukraine Facility. It addresses identified immediate and short-term needs.
The Project is further aligned with Ukraine's Energy Strategy and with the National Energy and Climate Plan and addresses needs identified in Ukraine's Third Rapid Damage and Needs Assessment. The proposed measures thereby not only re-establish lost capacity, but also increase the residual lifetime of the affected components, most of which are several decades old, compared to expectations prior to the war. It is to be noted that the development priorities that the Project is expected to advance in Ukraine were already included in Ukraine's Multiannual Indicative Programmes 2021-2027 and also coincide with NDICI's and the EFSD+ priorities.
EIB financing to the Project will contribute to address market failures related to climate externalities (reduction of carbon emissions and air pollution associated with fossil electricity generation). The Project also contributes to security of supply, a public-good, which is currently heavily impacted by Russian attacks on energy infrastructure.
The Project has Excellent economic return considering the estimated costs of implementation and operation and the economic value of the electricity generated.
The Promoter is an experienced hydropower operator, with strong internal technical capacity, EIB expertise on project preparation were not requested. Monitoring of the project will take place via quarterly Project Progress Reports.
The Bank's financing addresses the financing needs of the Promoter, in the challenging circumstances of the war, where the hydro power plants of the Promoter are under constant attack.
The project will not likely to have significant impact on environment, as the related works concern the rehabilitation and modernisation of components of existing hydropower plants, including the purchase of equipment.
The the promoter shall ensure that implementation of the project will be done in accordance with the EIB's Guide to Procurement and the relevant applicable EU public procurement rules.