The European Bank for Reconstruction and Development (EBRD) is lending €180 million to Ukrainian Railways (Ukrzaliznytsia, UZ) to install gas engine for power generation at sites around the country. UZ first announced the plans for gas engines in June.
Initially the gas engines will help mitigate the widespread electricity shortages Ukraine expects this winter after Russian attacks on its power generation system. In future they and others like them can help system balancing as Ukraine installs more solar and wind power.
The loan will finance the supply and installation of up to 270 MW of decentralised gas-fired power generation capacity at existing UZ sites. The project, which will cost a total of €248 million, will make the national energy system more resilient.
The EBRD loan will be co-financed by a parallel investment grant of up to £10 million from the UK and an investment grant of up to €56 million from a multilateral or bilateral international donor.
“In the current emergency, the EBRD is pleased to finance new players such as Ukrainian Railways entering the energy generation market and is making plans for more lending in this area,” said Arvid Tuerkner, EBRD Managing Director for Ukraine and Moldova.
EBRD is working with Ukraine over the longer term to move to a renewable energy-led future as soon as conditions allow.
JSC Ukrainian Railways is a vertically integrated national railway operator owned by the government of Ukraine. A monopoly provider of rail transport in Ukraine, it operates a railway network of around 20,000 km and related infrastructure.