Summary sheet
The project will finance the construction and operation of one solar photovoltaic plant (PV) (~99 MWp).
The aim is to produce electricity from low carbon sources, reduce carbon emissions and air pollution (compared to fossil-fuel generation). By addressing the market failure of negative climate and environmental externalities, the project supports the EU and national renewable energy generation targets, REPowerEU Action Plan as well as the EIB's Climate Action and renewable energy objectives.
The solar PV Project will support the 2030 targets set out in the National Energy and Climate Plan of Croatia and the REPowerEU Action Plan.
The financing of this Project contributes to Bank's lending priority objectives on Decarbonising the Energy Supply (RES), as well as on Climate Action and Economic and Social Cohesion.
In terms of addressing market failures, the solar PV Project produces electricity from low carbon sources and thereby helps to address the market failure of negative environmental externalities, through the reduction of carbon and air pollution.
The Project is expected to rely on sales on the day-ahead market, or commercial power purchase agreements. Thereby the Project improves market efficiency and competition.
On project quality, the Project is supported by adequate capabilities / governance of the Promoter. In terms of project results, it is expected to have a positive economic rate of return, considering the economic value of the electricity generated. Therefore, the Project is expected to generate a positive broader social benefit by generating clean and renewable power at a cost (LCOE) reasonably below the cost alternatives in Croatia.
The EIB's financial contribution stems from the Bank's capacity to provide long-term financing at favourable conditions which is substantially aligned with the long economic life of the assets to be financed.
The solar PV including its ancillary facilities falls under Annex II of the Environmental Impact Assessment (EIA) EU Directive 2011/92/EU, as amended by Directive 2014/52/EU, requiring the competent authorities to determine whether an EIA is required. Competent authorities (Ministry of Environmental Protection and Energy), in Croatia, in October 2019, screened the project out from the requirement to carry out an EIA process.
The Promoter is a public entity operating in the utility sector and the Bank would normally require the contracts of the Project to be tendered in accordance with the applicable EU procurement legislation, Directive 2014/25/EU as well as Directive 92/13/EEC, as interpreted by the Court of Justice of the EU, with publication of tender notices in the EU Official Journal, as and where required. However, as this Project will be co-financed (by more than 50%) by EBRD, the Directive 2014/25/EU shall not apply to the contracts under this Project as per the Article 20.2 of the Directive. EBRD and EIB agree that the Promoter will implement the Project in accordance with the procurement rules and procedures of the EBRD.