EPCG AND GERMAN DEVELOPMENT BANK SIGN CONTRACT FOR INSTALLATION OF EIGHTH GENERATOR AT PERUĆICA HYDROELECTRIC PLANT

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EPCG AND GERMAN DEVELOPMENT BANK SIGN CONTRACT FOR INSTALLATION OF EIGHTH GENERATOR AT PERUĆICA HYDROELECTRIC PLANT

© Copyright: EPCG

Representatives of the EPCG and German Development Bank (KfW) signed a loan agreement worth € 40 million aimed at financing the installation of the A8 generator at the Perućica Hydroelectric Plant, as part of the third phase of the reconstruction and expansion project of this hydroelectric facility.

The loan has been secured through a new instrument resulting from the collaboration between the European Commission and KfW, the EFSD+ guarantee (European Fund for Sustainable Development Plus), which is a novelty even for the region. The loan repayment period is 15 years, with a five-year grace period.

The installation of the additional, eighth generator at Perućica is just one of the activities in the process of making the EPCG's production portfolio greener, which is part of the decarbonisation of Montenegro's energy sector endeavour. Through this, the EPCG is making a significant contribution to the decarbonisation process, which involves building carbon-neutral energy sources, adhering to modern environmental protection standards, and improving competitiveness, which is the goal of every responsible company.

EPCG CEO, Ivan Bulatović, expressed his satisfaction with the continuation of the highly productive cooperation with KfW.

"We are pleased that by signing this agreement, we have made a serious contribution to the development of this facility. It is a very favourable arrangement, and the first of its kind that has not been issued with a state guarantee but with the EFSD+ guarantee, which speaks volumes about the fact that the international community perceives us as a credible partner. This is important in a broader sense, as it confirms our efforts to move towards decarbonisation," Bulatović stated.

KfW Director for Southeast Europe and Turkey, Pablo Obrador, said that the signing of the agreement confirms that the cooperation between EPCG and KfW over the past two decades has been very successful.

"This is the last of three loans that the KfW has provided for the modernisation of Perućica, and the investments within the framework of joint arrangements for this plant, including this contract, exceed € 83 million, which indicates a serious level of cooperation, especially considering the progress in terms of the EFSD+ guarantees," Obrador emphasised.

Minister of Energy, Prof. Dr Saša Mujović, stated that there is no success in energy without a vision and strategy.

"Energy doesn't allow for improvisation, and plants like Perućica and Piva could only have been built by a strong state with clear developmental goals. Our generation has the honour of continuing the work of our predecessors, modernising and improving their efforts. The modernisation of Perućica is especially important in the context of the need for a stable energy source, and the full significance of this project will become apparent after the waters of the Zeta River are diverted into the reservoirs," Mujović concluded.

The existing intake system, machine hall, and 110kV substation can support the final phase of the Perućica construction, which includes the installation of the eighth generator with an installed capacity of 58.5 MW. This will increase the nominal capacity of Montenegro's oldest large power plant from 307 MW to 365.5 MW. It is planned that the future A8 generator, together with generators A6 and A7, will be connected to the third pressure pipeline, which is designed to handle a full flow of 3 x 12.75 m³/s.

In addition to financial support in the form of loan funds, the EPCG will also receive technical support for activities crucial to its transformation into a green, market-oriented company.

The international tender for selecting the contractor for the production, delivery, installation, and commissioning of the A8 generator will be announced in October of this year. The commissioning of the eighth generator is planned for 2027. It is worth noting that, in April, the EPCG signed a contract with CGES for connection to the transmission system.