The European Bank for Reconstruction and Development (EBRD), in conjunction with Erste Group Bank AG and its local subsidiary Erste Bank a.d. Novi Sad (Erste), has sanctioned a financing package totaling €91.4 million for the development of a new windfarm in Serbia by Enlight Renewable Energy (Enlight). This investment is expected to significantly contribute to Serbia’s objective of diversifying its energy mix.
The financing arrangement entails parallel loans of €45.7 million each from EBRD and Erste, inclusive of associated debt service reserve facilities. Utilizing these funds, Enlight’s local subsidiary will spearhead the development, construction, and operation of the 94-megawatt (MW) windfarm, dubbed the “Pupin” project in honor of Mihajlo Pupin, a renowned Serbian scientist. The project, originated by Enlight and New Energy Solutions (NES), is slated to commence commercial operations in the latter half of 2025. It represents an extension of the existing Kovacica windfarm in Vojvodina, also owned by Enlight and previously financed by the same lenders in 2017.
Upon completion, the Pupin windfarm is projected to provide clean electricity to over 40,000 households, equivalent to a medium-sized city like Zrenjanin. Moreover, it aims to reduce the carbon intensity of Serbia’s power sector and facilitate its transition towards a greener economy. Notably, coal currently dominates electricity production in Serbia, underscoring the urgency of diversification away from fossil fuels to address long-term energy challenges.
The Pupin project was financed under Serbia’s inaugural renewable energy auction for wind capacity in 2023, which allocated contract-for-difference for 400 MW. Subsequent auctions, each for 300 MW of wind capacity, are scheduled for 2024 and 2025, alongside similar auctions for solar power plants. This scheme, supported by technical and policy guidance from EBRD and funded by the Swiss State Secretariat for Economic Affairs (SECO), encourages the integration of renewables into the market, offering developers support aligned with market prices and revenue from electricity sales.
Matteo Colangeli, EBRD Regional Director for the Western Balkans, lauded Serbia’s decision to advance with auctions, highlighting their transformative impact in unlocking the country’s renewable energy potential. Colangeli expressed commitment to supporting Serbia’s forthcoming wind and solar auctions to further expedite its green transition.
Gilad Yavetz, CEO and co-founder of Enlight Renewable Energy, emphasized the strategic significance of situating the Pupin windfarm near the Kovacica site, underscoring operational efficiency and enhanced returns. Yavetz also acknowledged the instrumental role of EBRD and Erste in financing the Pupin project, reaffirming their continued partnership.
Wolfgang Hargassner, Head of Corporate Finance at Erste Group, hailed the realization of the Pupin project as a milestone in Serbia’s renewable energy journey, anticipating its catalytic effect on future projects. Hargassner attributed the project’s success to collaborative efforts among stakeholders, including investors, banks, advisers, and suppliers.
Enlight Renewable Energy, operating in the United States, Israel, and nine European countries, specializes in developing, financing, constructing, owning, and operating utility-scale renewable energy projects utilizing solar, wind, and energy storage technologies. The company is listed on NASDAQ (ENLT) and the Tel Aviv Stock Exchange (ENLT.TA).
Erste Group Bank AG, a leading financial services provider in central and eastern Europe, boasts over 16 million customers and total assets exceeding €337 billion.
The EBRD, a prominent institutional investor in Serbia, has invested €9 billion across over 350 projects in the country to date.