Nordic Investment Bank (NIB) and Finnish firm PVO-Vesivoima have signed a loan agreement totalling EUR 30M (US$44.7M) for upgrade work at hydro power plants in northern Finland, as part of PVO-Vesivoima’s investment programme for 2009–2015.

The programme includes the refurbishment of five hydro power plants on the river Iijoki, in Raasakka, Maalismaa, Kierikki, Pahkakoski and Haapakoski, built in the 1960s. The power plants will be equipped with new turbines and generators, as well as modernised automation systems. The renovation of the Kierikki and Haapakoski plants was completed in 2007–2009.

The effort will allow the company to increase the capacity of the plants by 40 MW, an increase of 22% from the current level. The larger output capacity will also help improve balancing of the Finnish power distribution grid.

“We see this project as a substantial contribution to the more efficient use of renewable resources in the production of energy and as having the potential to help phase out coal-fired power generation,” said Johnny Åkerholm, President and CEO of NIB.

Earlier this year, NIB extended a loan for the modernisation of three hydro power plants run by Kemijoki Oy in northern Finland.

PVO-Vesivoima is a fully owned subsidiary of the Finnish power company Pohjolan Voima Oy. The company owns and operates eight hydro power plants along the Kemijoki, Iijoki and Kokemäenjoki rivers.