Norway. Energiselskapet Buskerud AS

Date of agreement:22 Sep 2014
Customer:Energiselskapet Buskerud AS
Amount in NOK:NOK 350 million
Amount in EUR:EUR 43 million
Maturity:15 years
NACE sector / loan type:Production and distribution of electricity

This loan contributes to climate change mitigation: 40%

Financing from NIB Environmental Bond proceeds

NEB-eligible share: 20%

NEB category: Renewable energy generation

Amount disbursed: EUR 8.3 million

Note: For loans in other currencies than EUR, the equivalent in EUR is based on the exchange rate effective for the disbursement. Read more about the NIB Environmental Bonds


The loan has been provided for upgrading the existing Kaggefoss and Mykstufoss hydropower plants in the southern county of Buskerud, Norway, and for upgrading an electricity network in the region during the 2013–2015 period.

The upgrade is expected to increase the base load production of Kaggefoss by 2.5%, providing an annual capacity of 600 GWh. The Kaggefoss plant was built in 1949 and upgraded in 1963. The base load capacity of the Mykstufoss plant, built in 1964, is also expected to increase by 2.5% to 285 GWh per year.

Both projects are part of Energiselskapet Buskerud’s (EB’s) upgrading programme to increase cost efficiency, optimize production and reduce environmental impact. The investment is expected to extend the lifetime of both plants by 30–50 years.

EB will also upgrade its distribution lines from 66 kV to 132 kV and add new substations to increase the security of supply, reduce power losses and environmental impact such as the weakening of magnetic fields along the line. The increased capacity will increase the transfer capacity and allow for additional connections to new production units. The project also prepares the network for installing smart meters by 2019, a measure to comply with increasing renewable production and stricter supply security requirements.

EB is Norway’s 10th largest hydroelectric power company in terms of electricity produced. The company distributes to about 58,000 customers. EB employs about 238 people and is equally owned by the Municipality of Drammen and Buskerud County Municipality’s renewable investment company Vardar AS.

Fulfilment of NIB's mandate

Upgrading the distribution network will enhance security of supply and contribute to increased productivity and economic efficiency. The network project will reduce congestion and enable new generation capacity to be connected to the grid. New production capacity is likely to be developed from bioenergy, given the forest resources in the region, in addition to small hydropower stations.

Although the relative additional hydropower capacity increase is quite small, the opportunity cost of this investment is considerable in terms of adding to the security of supply. Due to its low operating costs, hydropower is the most efficient electricity production technology available.

Sustainability summary


Increasing hydropower generation in an already regulated watercourse is an environmentally efficient way of generating electricity.

The projects are not expected to impact the environment significantly.


Press release

NIB finances Norwegian hydropower plants and network upgrade

Press release

NIB finansierer oppgradering av vannkraftverk og nettverk