The European Investment Bank (EIB), the European Union's long-term financing institution, has advanced a loan of 7 billion pesetas (ECU 43 million)(1) to Energía Hidroeléctrica de Navarra S.A. (EHN) towards financing construction of three wind parks in Navarra (Spain). The funds are being channelled through the intermediary of three financial institutions, Caja de Ahorros de Navarra, Instituto de Crédito Oficial (ICO) and Banco Central Hispano.

The three new wind parks will be sited some 30 km south east of Pamplona, in the Guerinda Mountains, and will initially have a total of 115 wind turbines and an installed capacity of 69 MW, with plans to expand the park subsequently to 159 turbines and 95 MW capacity. The project forms part of Navarra's renewable energy programme, designed to make this region self-sufficient in energy; the programme includes bringing into service wind parks with a combined installed capacity of 600 MW, which could meet 45% of the region's electricity requirements.

The European Union's energy policy is based on three fundamental elements: security of energy supplies, the competitiveness of energy resources and protection of the environment. On the occasion of this new loan, EIB Vice-President Dr Luis Martí stated that development of renewable energy sources was very much in tune with European policy objectives in the field of energy and therefore represented a prime sector for EIB financing.

With the Guerinda project, Navarra will have the largest wind park in Europe.

The EIB was founded in 1958 by the Treaty of Rome, which established the European Economic Community, for the purpose of fostering integration, balanced development and economic and social cohesion in the Member States, by means of long-term financing for capital investment contributing to attainment of the European Union's objectives. In practical terms, the EIB provides support for viable projects promoting: development in the EU's less-favoured areas; construction of trans-European transport, telecommunications and energy networks; enhanced international competitiveness and integration of European industry, especially SMEs; protection and improvement of the environment; security of the Union's energy supplies. Within certain limits, the EIB can also deploy financing outside the European Union, in furtherance of the EU's cooperation policy with non-member countries.Owned by the EU Member States, the EIB raises the resources for its lending on the capital markets, where its bond issues are systematically awarded the top "AAA" rating.

(1) The conversion rates used by the EIB for statistical purposes during the current quarter are those obtaining on 29 March 1997, when ECU 1 = ESP 165,605, GBP 0.71.