EIB loans EUR157 million for renewable energy in Iceland

The European Investment Bank (EIB) has loaned a total of €157 million for the construction and operation of two geothermal electricity generation and transmission facilities in the southwest of Iceland.

The plants will be built by Iceland’s three largest energy companies Landvirkjun, Reykjavik Energy, and Hitaveita Sudurnesja. They will supply electricity for the increased requirements of the aluminium plant of Nordural as well as to municipal distribution grids in the southwest of the country and to the national power grid.

In addition the plants will produce heat which will be used in one case for district heating and in the other to supply new industrial requirements.

Thomas Barrett, Director of EIB, who signed the loan contracts said: “The investments contribute to the common EU/EFTA policy to promote renewable energy, which has a key role to play in the Kyoto Protocol. With the recent Russian signature the protocol will enter into force in early 2005, making the emissions reduction targets taken on for the 2008-2012 period legally binding.”

The investments should also have a positive economic impact for the Icelandic aluminium industry.

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