Erste and EBRD approve financing for new wind farm in Serbia

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The European Bank for Reconstruction and Development (EBRD), together with Austrian bank Erste Group Bank and its local subsidiary Erste Bank Novi Sad, approved today (27 March) a financing package worth 91.4 million euros for the construction of a new wind farm in Serbia.

With a planned capacity of 94 megawatts (MW), the “Pupin” wind farm will be built by Israeli energy company Enlight Renewable Energy (Enlight).

“Serbia’s decision to move ahead with auctions is proving to be a game changer in terms of unlocking the country’s renewable energy potential. We are pleased to see Pupin being the first project to reach financial close and moving quickly through implementation, proving that speed of execution and best practice in terms of environmental and social standards can go together. We are committed to support Serbia’s second wind and solar auction later this year to continue accelerating the country’s green transition,” said Matteo Colangeli, EBRD Regional Director for the Western Balkans.

The EBRD and Erste will provide parallel loans, worth 45.7 million euros each, including the associated debt service reserve facilities. Enlight’s local subsidiary will use the proceeds to develop, construct and operate the 94 MW wind farm, and named in honour of Mihajlo Pupin, one of Serbia’s greatest scientists.

The wind farm is expected to begin operating commercially in the second half of 2025. It is an extension of the existing Kovacica (blacksmith) wind farm in Vojvodina, which is also owned by Enlight and was financed by the same lenders in 2017.

“Building the Pupin wind farm in close proximity to our existing Kovacica (Blacksmith) site represents a noteworthy implementation of our ‘Interconnection Expand’ strategy,” said Gilad Yavetz, CEO and co-founder of Enlight Renewable Energy. “We were able to leverage the technical knowledge and transmission infrastructure that was already in place at Kovacica, resulting in greater efficiency and higher returns for Pupin. In addition, we were fortunate to engage once again with our partners EBRD and Erste for financing of the Pupin project; these are the same lenders who supported us in the development of the Kovacica site.”

Once commissioned, the Pupin wind farm is expected to meet the energy demand of more than 40,000 households, equivalent to the number of households, the EBRD noted in a press release.

“The financing of the first wind farm project under Serbia’s new renewable energy auction scheme marks a major step on the country’s path to green energy transition and we hope it will pave the way for other projects in the future. The realisation of the Pupin project is thanks to the great cooperation and unwavering commitment among all the parties involved, including investors, banks, advisers, the power off-taker, the turbine supplier, and many others,” said Wolfgang Hargassner, Head of Corporate Finance at Erste Group.

This project was financed under Serbia’s first renewable energy auction for wind capacity, which took place in 2023 and awarded contract-for-difference for 400 MW. A second and third auction, each for 300 MW of wind capacity, are expected to take place in 2024 and 2025, respectively. Similar auctions will be held in parallel for solar power plants.

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