HEP and EBRD Terminate Loan Agreement for Ombla Hydropower Plant

Hrvatska elektroprivreda (HEP) and the European Bank for Reconstruction and Development (EBRD) have terminated the loan agreement for the Ombla Hydropower Plant, HEP reported today, explaining that this decision is based on HEP’s readiness to further align the project documentation for the Ombla Hydropower Plant with current domestic and European nature protection regulations.

– Hrvatska elektroprivreda, guided by the principle of precaution, and in accordance with the recommendation of the Ministry of Environmental Protection and Nature, is ready to further align the project documentation for the Ombla Hydropower Plant with current domestic and European nature protection regulations and interventions in the ecological network with the aim of applying the highest environmental protection standards. Given the expected duration of this process, and to avoid further costs, HEP and EBRD have agreed to terminate the loan agreement – it was announced by HEP.

HEP and EBRD confirm their readiness to continue cooperation on some future investments, the statement concludes. HEP signed a loan agreement with EBRD in the amount of 123.2 million kuna for the construction project of the Ombla Hydropower Plant at the end of November 2011. The total value of the investment in the first underground power plant in Croatia, Ombla, with a capacity of 68 megawatts (MW), is estimated at 150 million euros.

As part of the loan arrangement, HEP and EBRD also agreed on the preparation of a Biodiversity Management Study, and the results of this study, prepared by the consulting firm WSP, were presented by HEP in March of this year.

HEP stated at that presentation that the construction of the Ombla Hydropower Plant will not endanger the cave’s living world and that this, along with the implementation of measures to reduce and mitigate negative impacts and the execution of the Biodiversity Management Plan and expert supervision during preparation, construction, and use, does not pose an obstacle to the construction of the Ombla Hydropower Plant.