Summary sheet
Investments in the implementation of one pumped-storage hydropower project (150 MW) and in the implementation of a run-of-river hydropower plant (28 MW) bypassing three old plants to be deconstructed in Austria in the period from 2024 to 2028.
The development of hydropower pumped storage hydropower supports national and European targets related to renewable energy production and thus contributes to climate change and security of energy supply objectives of the EU. The project is therefore eligible under Article 309 (c) common interest in energy (renewable energy) and also contributes to the environmental protection (tackling climate change). The project is in line with the Bank's priority objectives for energy sector lending in the EU related to renewable energy sources and climate action.
EIB's investment in the project supports the deployment of run-of-river and pumped storage hydropower capacity in Austria, thereby supporting the goal of meeting 100% of the electricity demand from renewable energy sources (RES) by 2030, as set out in the National Energy and Climate Plan.
Renewable generation and storage technologies contribute towards increasing security of energy supply by reducing dependency on energy imports and ensuring price stability. Security of supply can be considered as a public good, which is not always effectively reflected in market prices.
Financing this project is in line with the Bank's Energy Lending Policy on renewable energy, and by supporting the energy transition as enabling infrastructure (networks, storage) for the integration of intermittent RES. The Project is also fully aligned with transversal objectives on Climate Action (mitigation).
By directly and indirectly enabling the increased deployment of intermittent RES the project addresses negative climate and environmental externalities, a market failure, through the reduction of carbon and air pollution, compared to generation and provision of grid system services based on fossil fuels.
Considering the economic value of the electricity generated and system services provided, broader positive social benefit is attained by generating renewable power at a cost (LCOE) reasonably below the cost of alternatives.
The project is supported by adequate governance and capabilities of the promoter.
The proposed loan will contribute to the diversification of the borrower's financing sources and thus strengthen the overall financing position of the company and decrease borrower's exposure to the volatility of capital markets. The EIB loan's flexible features, including the tranching for the two separate hydro projects, will improve the promoter's cash flow and liquidity management. Furthermore, EIB's capability to lend a sizeable loan ticket will provide substantial support for the promoter's investment plans and creates a positive signalling effect to the capital markets.
EU EIA Directive (2011/92/EU), as amended by Directive 2014/52/EU, was transposed in Austria's environmental law UVP-G 2000, and compliance is legally binding for the approval of the projects. UVP-G 2000 Annex 1 No. 30 stipulates the requirement of a full EIA for hydropower plants, which applies to both projects in this operation. Notably Ebensee PSH received the full environmental approval in 2017 under UVP-G 2000. For Traunfall HPP an extensive environmental impact assessment (EIA) was performed by the promoter and submitted to the competent authority (State Government of Upper Austria) in July 2023; additional documents were submitted in March 2024. It is expected that the competent authority will submit their decision in the last quarter of 2024, after completion of review and public consultations. The project is expected to contribute to climate action and environmental sustainability (CA&ES) objectives.
By decision 2008/585/EG the EC has exempted all contracts which are being awarded to implement electricity generation projects in Austria from the scope of the Utilities Directive 2004/17/EC. No public procurement is therefore required.