Renewable energy is booming in Ukraine as the government rushes to reduce its dependence on Russia gas. The European Bank for Reconstruction and Development (EBRD) has underpinned the effort by arranging a €150mn syndicated loan for the construction of a 250MW wind farm in the Kherson region of southern Ukraine, the development bank said in a press release on January 23.

The loan will be extended to the local developer SyvashEnergoProm LLC, co-owned by renewable energy groups Total Eren of France and NBT of Norway, for the construction of the initial 133 MW phase. The farm is expected to begin power generation by the end of 2019, the EBRD said.

“The package will consist of a €75mn EBRD A-loan and a B-Loan of up to €75mn from the Green for Growth Fund (GGF) and the Netherlands Development Finance Company (FMO). A parallel loan of €5mn will be provided by the Nordic Environment Finance Corporation (NEFCO),” the EBRD said.

Once the project is fully commissioned, it is expected to reduce CO2 emissions by 470,000 tonnes annually, and to produce over 850,000 MWh of renewable energy each year – enough to provide power to the Ukrainian municipality of Rivne, which has approximately 100,000 households.

The wind farm is the latest investment under the EBRD’s €250mn Ukraine Sustainable Energy Lending Facility III (USELF III) framework approved by the bank in July 2018. USELF III builds on two previous programmes co-financed by the EBRD and the Clean Technology Fund, which yielded 13 renewable energy projects in Ukraine with an aggregate installed capacity of 151 MW.

Speaking at the signing ceremony in Davos on January 22, EBRD president Suma Chakrabarti said, "We are delighted to be supporting the two world class developers who will build Ukraine's largest wind farm. This shows that Ukraine's commitment to carry out energy sector reforms is increasing the investor confidence needed to achieve the country’s energy transition. This project is good news for Ukraine, investors and for the planet."

Ukraine has become the EBRD’s biggest country of operation in the last year. It launched a new five year strategy for the country last October and has made multiple investments including providing $15.5bn for the banking sector, the bank said previously.

The EBRD is the largest international financial investor in Ukraine. Since the start of its operations in the country in 1993, the bank has made a cumulative commitment of almost €13.1bn across some 418 projects in Ukraine.