EDP REPOWEREU FRAMEWORK LOAN

Promoteur – Intermédiaire Financier

EDP RENOVAVEIS SA,EDP SA

Lieu

• Portugal
• Espagne
• Italie

Description

The project will finance the construction and operation of a set of renewable energy plants, such as solar photovoltaic, onshore wind and a battery storage in Spain, Portugal and Italy in the period 2024-2026.

Additionality and Impact

The Project increases renewable energy generation capacity in Spain, Portugal and Italy and contributes to their respective national and EU 2030 climate objectives, as set out in the National Energy and Climate Plans. Moreover, the investment contributes to the REPowerEU Action Plan.

This Framework Loan contributes to the Bank's lending priority objectives of Renewable Energy, on Climate Action, Environmental Sustainability and partially to Economic and Social Cohesion.

The Project will produce electricity from low carbon sources (solar PV and wind), addressing the market failure of negative climate and environmental externalities through the reduction of carbon emissions and air pollution compared to fossil-fuel generation. 

The individual schemes are expected to rely on a combination of wholesale market revenues and corporate power purchase agreements or other similar long-term offtake arrangements. They thereby contribute to the Bank's Energy Lending Policy objective of supporting market integration of renewables.

The Project Quality and Results is rated Very Good. The Project is expected to have an Excellent rated economic rate of return, considering the economic value of the electricity generated and the expected positive broader social benefit by generating clean and renewable power at a cost (LCOE) reasonably below the cost alternatives in Portugal, Spain and Italy.

The schemes are expected to be located mostly in EIB Cohesion Priority regions. As per initial CAPEX estimate for the pipeline, c. 72% is located in Less Developed Regions and c. 9% in Transition.

The Bank's financial contribution is rated Very Good. The EIB's offering is valuable to the client given the more flexible conditions compared to market alternatives (e.g. longer tenor and grace period). The Bank's financing shows the alignment of the investments and the Promoter's growth strategy with the EU policies in relation to climate change, with the "EIB Green Loan" label deemed as a stamp of quality on the Promoter's investments and environmental-related procedures.

Objectifs

The aim is to finance part of the Promoter's renewable energy pipeline. The project supports the REPowerEU initiative and contributes to the 2030 decarbonisation targets set out in the respective National Energy and Climate Plans. Most of the investments will be located in cohesion regions, being therefore eligible under Article 309 point (c) common interest. The underlying projects are expected to be economically justified, as it will generate economic benefits, notably in terms of climate action by stepping up investments in renewable energy, creation of economic activity and CO2 emission reductions.

Secteur(s)

• Énergie - Production et distribution d'électricité, de gaz, de vapeur et d'air conditionné

Montant BEI envisagé (montant approximatif)

EUR 900 million

Coût total (montant approximatif)

EUR 1623 million

Aspects environnementaux

Some individual schemes and most of the ancillary infrastructure fall under Annex II of the environmental impact assessment (EIA) Directive 2011/92/EU as amended by Directive 2014/52/EU, requiring the competent authorities to determine whether an EIA Report is required, while the wind projects fall under Annex I, requiring an EIA report. Some of the schemes have already undergone an EIA process and obtained positive environmental decision. Likewise, most of the other projects are expected to be screened in or subject to an EIA process. The EIB will assess the capacity and procedures of the Promoter to ensure the schemes' compliance with the sector-relevant national and European environmental and biodiversity regulations. For large allocations, the authorization procedure and compliance with the relevant EU directives, specifically Habitats and Birds Directives (92/43/EEC and 2009/147/EC respectively), will be further assessed during the appraisal of the individual scheme. Given that China largely dominates the market of photovoltaic solar panels, and media reports about the risk of forced labour, the EIB will apply an enhanced due diligence on the topic, in line with the EIB's Environmental & Social Standards. The project contributes to the Climate Action and Environmental Sustainability (CA&ES) objectives, in particular to climate change mitigation and pollution prevention and control.

Passation des marchés

The Promoter has been assessed by the EIB as being a private company not being subject to EU rules on public procurement or concessions. However, if at the project appraisal, the EIB were to conclude that the Promoter is subject to the EU public procurement legislation, then the European Commission will be duly informed, which will require the Promoter to apply such rules.

Statut

Signé - 19/12/2024