Ignitis Group concluded a EUR 300 million financing agreement with Swedbank
On 9 March 2023, Ignitis Group and its subsidiary Vilniaus Kogeneracinė Jėgainė (Vilnius CHP) concluded an agreement for a EUR 220 million loan with Swedbank. The funds will be used for finishing the construction of the biomass unit and re-financing the long-term loan of Vilnius CHP. The Group and Swedbank have also agreed upon a credit line of EUR 80 million.
EUR 85 million of the loan from Swedbank will be used for finishing the construction work of Vilnius CHP biomass unit. The remaining EUR 135 million will be used for re-financing the loan granted to Vilnius CHP by the European Investment Bank (EIB), which the Group is now taking over.
“We are pleased to continue to build trust with Swedbank, who remains one of the most reliable partners, and who contributed last year to overcoming the energy crisis. By providing us with a credit line of EUR 300 million, it will help us finance one of our biggest projects. This is a result of a long and consistent cooperation and positive partnership between our team and Swedbank,” says Ignitis Group CFO Jonas Rimavičius.
The entire Vilnius CHP’s investment portfolio, including the biomass unit, is approximately EUR 420 million. EUR 220 million will be financed through loans, an estimated EUR 140 million through EU funding, and the remainder from company resources. The Vilnius CHP biomass unit is currently undergoing cold tests, and preparations for hot testing are underway. Commercial operations are set to begin in Q3 2023.
“We appreciate our long-term cooperation with Ignitis Group. We believe that the financial means will help the Group successfully finish its ambitious projects, which will help fulfill national objectives of energy network’s resilience and cutting down emissions,” says Swedbank Lithuania CEO Inga Skisaker.
The Group and Swedbank have also reached an agreement for a credit line of EUR 80 million, which will partially re-finance two credit line facilities (EUR 150 million in total) of its subsidiary Ignitis and will be used for working capital needs.
Vilnius CHP will be one of the most modern combined heat and power plants in Europe. The plant’s overall electric power is estimated to reach 93 MW once the project is finalized, while the heat energy is estimated to reach 239 MW.
A waste-to-energy unit has been operating in Vilnius CHP since March 2021, and once the biomass unit construction is complete, energy will be generated from biomass as well. The plant converts an approximated 160,000 tonnes of waste into energy every year, while biomass unit will use an estimated 500,000 tonnes of biomass.
