Reading Time: 3 minutes
In a significant move to enhance the supply of competitively priced renewable energy in Romania, the International Finance Corporation (IFC) is offering long-term debt financing for the 461-megawatt (MW) Vifor Wind Power Plant. This project is expected to play a crucial role in reducing Romania’s greenhouse gas (GHG) emissions and bolstering the country’s climate commitments and energy transition goals.
The Vifor Wind Power Plant is being developed through a joint venture between Rezolv Energy S.A., the regional energy platform of global infrastructure investor Actis, and the global renewable energy company Low Carbon. The project is divided into two phases: Phase 1, which has started construction with an installed capacity of 192 MW, and Phase 2, which will add an additional 269 MW and is currently preparing for construction. IFC’s loan for Phase 1 includes €21.4 million from its own account, forming part of a larger €291 million financing package alongside commercial banks and other lenders.
As one of Romania’s first large-scale greenfield renewable energy projects financed without public support, the Vifor Wind Power Plant is expected to significantly reduce the carbon footprint of Romania’s energy sector. Once fully operational, it is projected to cut an estimated 500,000 tons of carbon dioxide equivalent emissions annually, aligning with Romania’s goal of reducing net GHG emissions by at least 55 percent by 2030.
Jan Viton, Financing and M&A Director at Rezolv Energy, expressed pride in the project, stating, “This is a truly landmark project and the first one Rezolv Energy brings to financial close. We are very proud of the interest this financing has generated among a wide spectrum of financial institutions, and we are delighted to have established a core group of lenders including IFC, which we hope to continue to call upon in the future as we deliver our pipeline of renewables projects across the region.”
Martin Langham, Managing Director at Low Carbon, added, “We are delighted to be partnering with IFC on Vifor, who will play a crucial role in its establishment by helping to unlock capital to finance the project. Once built, Vifor will be one of the largest wind projects in Eastern Europe and reinforces our track record of working with institutional investors to deliver large-scale renewable infrastructure, while playing a key role in supporting Romania’s efforts to decarbonize its electricity grid.”
Despite progress in reducing GHG emissions, Romania still relies heavily on fossil fuels, resulting in an emissions intensity 1.4 times higher than the European Union average. With the scheduled 2032 phase-out of coal for electricity generation, an estimated $31.5 billion investment is needed to facilitate the energy transition in the power generation and storage sector.
The wind power plant, located near Buzau in southeastern Romania, will also introduce a pioneering hybrid energy sales model, combining wholesale electricity market sales with corporate power purchase agreements involving commercial and industrial customers and traders.
Ary Naïm, IFC Manager for Central and South Europe, emphasized the importance of this project, stating, “To achieve its climate commitments, Romania needs to accelerate its deployment of clean energy sources. IFC is pleased to have the opportunity to partner with Rezolv Energy and Low Carbon on this landmark project, to help demonstrate the bankability of private utility-scale onshore wind generation projects selling power on purely commercial terms and spur the energy transition in the country and region.”
Romania represents IFC’s largest country exposure in Europe, with a portfolio of $2.1 billion, and its 10th largest globally.
