DEPA RENEWABLE ENERGY FRAMEWORK LOAN

The operation, structured as a framework loan, will finance the development, implementation and operation of a portfolio of photovoltaic (PV) farms in Greece.

The aim is to increase renewable energy generation capacity, therefore contributing to the EU-wide targets of energy from renewable energy sources, including the Renewable Energy Directive (RED II) and RePowerEU. It will further contribute to the national renewable energy targets of the Greek Energy and Climate Plan (NECP). Additionally, the operation contributes to the EIB's lending priority objectives on Renewable Energy, Climate Action, Environmental Sustainability, as well as partially towards Economic and Social Cohesion. The project also contributes to the EIB's just transition objective, since about 70% of the projects will be located in Just Transition regions (c.570MW). Moreover, the PV plants will provide new generation capacity in a sector characterised by incomplete markets, relying on contracts with exposure to residual market risks. It is therefore expected to contribute also to the policy objective of supporting market integration of renewable energy projects.

This Project concerns the development and operation of a portfolio of solar PV plants in Greece. It will support the 2030 targets set out in the Greek National Energy and Climate Plan and the REPowerEU action plan.

The financing of this Project also contributes to the Bank's lending priority objectives on Energy (Renewable Energy), Environmental Sustainability and Climate Action (transversal) as well as Social and Economic Cohesion.

As the Project will produce electricity from low carbon sources, it will address the market failure of negative climate and environmental externalities, through the reduction of carbon emissions and air pollution (compared to fossil-fuel generation).

It is expected that the Project will rely on revenues from (i) commercial power purchase agreements ("cPPAs") and (ii) the wholesale market, therefore it is expected to improve market efficiency and competition.

On project quality, the level of the Promoter's governance and risk management capability after mitigation measures is deemed fair. The Project is expected to have a positive economic return, considering the economic value of the electricity generated. Therefore, the Project is expected to generate a positive broader social benefit by generating clean and renewable power at a cost (levelized cost of electricity - "LCOE") reasonably below the cost of fossil-fuel based alternatives in Greece.

The Bank's financial contribution is considered very good and valuable to the Promoter, as the EIB's offering is more favourable than market alternatives under various dimensions. Also, the Promoter deems the EIB financing as a quality stamp on its investments and environment-related procedures, which helps attract investors and co-financiers.

PV plants fall under Annex II of the Environmental Impact Assessment (EIA) Directive 2011/92/EU (as amended by Directive 2014/52/EU), require the competent authorities to determine whether an EIA is mandatory. Some projects of the pipeline have been screened in and have performed an EIA. The requirements of an EIA, Birds Directive 2009/147/EC and Habitats Directive 92/43/EEC will be verified during the appraisal.

The promoter has to ensure that the contracts for implementation of the project will be tendered in accordance with the applicable EU procurement legislation Directive 2014/24/EU, 2014/25/EU, as well as Directive 92/13/EEC, as interpreted by the EU Court of Justice, with publication of tender notices in the EU Official Journal, as and where required.