14 Dec 2020
EUR 56.10 million
|Date of agreement:||18 Oct 2019|
|Customer:||Municipality of Västerås|
|Amount in SEK:||SEK 850 million|
|Amount in EUR:||EUR 82.6 million|
|NACE sector / loan type:||Production and distribution of electricity|
The loan has been provided to finance the construction of a new unit in a combined heat and power (CHP) plant in Västerås, Sweden.
The municipality of Västerås is the borrower, funding investments by its subsidiary energy company Mälarenergi AB in a new CHP plant (Block 7).
The new wood- and biomass-fired CHP plant will replace two existing boilers fuelled with coal, oil and peat, in order to shift from fossil fuels to biofuels in energy and heat generation. It will increase the annual electricity production by around 25% whilst maintaining the same level of heat production.
The total project cost is SEK 1.7 billion (around EUR 165 million). Initial work has already started, and the project is scheduled for completion by 2020.
After the implementation, Mälarenergi will achieve its long-pursued goal to phase out oil and coal in heat and power production.
Västerås is the seventh largest municipality in Sweden. It was ranked the best environmental municipality of Sweden as well as the best energy municipality of Sweden in 2016 by the environmental media.
The investment will contribute to an increase in annual electricity production of 138 GWh per year (an increase of around 25 percent). The heat production will stay at the same level as prior to the project, with a total estimated annual production of around 868 GWh.
The new CHP plant will account for 36% of the total heating production, enabling the phasing out of Blocks 1–4. The project will increase the use of biofuels, adding value to activities related to forest harvesting as the value chain of production contributes to more efficient use of local forest resources through procurement of forest residuals. In addition, 10% of the fuel may consist of impregnated wood fractions classified as hazardous waste.
After the construction of the new CHP plant, the coal-fired boilers installed in 1963 will be decommissioned. This will help to ensure efficient use of biofuels in heat and energy production for the region.
Emissions into the air are expected due to the investment.
All expected emissions into the air from the new CHP are fully in line with what is considered to be the best available techniques and below the emissions requirements in the environmental permit. Moreover, the expected discharges of pollutants with the wastewater are below what is considered to be achievable by applying best available techniques.