Iberdrola Hydro Spain

Promoter – Financial Intermediary

Iberdrola S.A.

Location

• Spain

Description

The project concerns the capacity increase of three existing hydropower plants (HPPs), La Muela, San Esteban and San Pedro with the installation of additional turbines on the existing sites. La Muela, located in the province of Valencia, on the Jucar basin, would more than double its capacity (from 636 MW to nearly 1500 MW) with 4 new Francis reversible turbines. San Esteban and San Pedro, both located in the province of Ourense, on the Sil basin, will increase their combined capacity from 296 MW to nearly 500 MW. The investment concerns mainly electromechanical equipment (turbines, generators, transformers, etc) installation, and underground civil works (water intakes, penstock tunnels, turbine caverns, etc.) None of the capacity increases will entail any extension of the dams or any additional flooding.

Objectives

The project will expand the cost-effective production of renewable energy from existing hydropower plants, and complement the power output during peak periods and storing, with the use of low-cost off-peak electricity. As such, it is in line with EU renewable energy policies and will support Spain in meeting its commitments with respect to greenhouse gas emissions reductions.

Sector(s)

• Energy

Proposed EIB finance (Approximate amount)

Up to EUR 300 million.

Total cost (Approximate amount)

Estimated to be around EUR 600 million.

Environmental aspects

All project schemes are expansions of already existing hydropower plants, which were built years before the creation of the Natura 2000 network. Subsequently, the areas around the sites of the HPPs were classified as Natura 2000 sites and thus the sub-schemes are subject to a mandatory EIA according to national legislation. Permits were granted for two of the schemes, requiring measures to mitigate impacts from construction works on avifauna and vegetation. Details to be reviewed during appraisal.

Procurement

The promoter is a contracting entity in the sense of the Utilities Directive 2004/17/EC. Therefore, the promoter is required to tender works, supplies and services contracts following public procurement rules, including the publication in Official Journal of EU (OJEU) where appropriate. Details of the procedures applied by the promoter will be reviewed during the appraisal.

Status

Signed - 13/11/2009