Moldovan government has approved the ratification of an agreement with the EBRD on a 30.8-million-euro loan for the construction of the 400-kV Balti-Suceava power transmission line.
In particular, the Cabinet approved at a meeting on Wednesday the draft ratification of the loan agreement between Moldova and the European Bank for Reconstruction and Development for the implementation of the project "Moldova-Romania Power Interconnection Phase II", signed on March 13 in Chisinau by Energy Minister Victor Parlicov and the head of the EBRD office in Moldova, Catarina Bjorlin Hansen. In addition to the new 400 kV overhead power line, which will connect Balti and Suceava, a 400 kV power plant will also be built in Balti. The total cost of the project is estimated at €77 million. The EBRD will provide a loan of €30.8 million for its implementation (40% of the total cost of the project). According to the terms of the signed agreement, the loan will be repaid in 28 equal semi-annual installments (or as equal as possible) on June 20 and December 20 of each year. The last date of loan repayment is December 20, 2041. The commitment fee will be 0.5% per annum and the interest rate on the loan will be floating - EURIBOR 6 months +1%. In addition, the borrower may, as an alternative to paying interest at a variable interest rate on the entire loan or any portion of the loan at that time, choose to pay interest at a fixed interest rate on that portion of the loan. A further 40% (€30.8 million) of the financing will be provided by the European Investment Bank and the EU in the form of a loan, with the remaining €15.4 million to be provided by the EU in the form of a grant through the Neighborhood Investment Platform. Thus, the EBRD will finance a number of project components: construction of the 400 kV Balti-Suceava transmission line; construction of the Balti 400 kV station; rehabilitation of the internal transmission networks in Moldova; consultancy support for project implementation and related supervision and design works. Also, part of the investments will be used to strengthen the internal power transmission networks of the Moldelectrica state enterprise. The main objective of the project "Moldova-Romania Power Interconnection Phase II" is to complete another power interconnection between Moldova and Romania by the end of 2027, with commissioning in 2028. The implementation of the mentioned investment project will contribute to the integration of Moldova's network into the EU market through interconnections with the European ENTSO-E network, increasing the efficiency of the national power sector, improving the stability and reliability of the local and regional power system, as well as increasing the development opportunities through other investments. The loan agreement signed with the EBRD also includes an Action Plan aimed at reforming the power sector, which covers both aspects of updating the legal framework and aspects of electricity market functioning, including the establishment of the Electricity Market Operator. // 17.04.2024 - InfoMarket.
