The European Investment Bank (EIB) has approved a EUR280 million loan Illwerke AG that will be used to help develop the 360MW Obervermuntwerk II pumped storage power plant in Austria’s Vorarlberg region.

Obervermuntwerk II will utilise the head between two reservoirs – the Silvretta (altitude of around 2000m) and the Vermunt (around 300m lower). The project is designed to reduce network losses, add balancing capacity to the network and provide additional regulating energy.

“Obervermuntwerk II will play a key role in generating environmentally friendly power – and not only for the Federal State of Vorarlberg. It will also make an important contribution to ensuring the stability and reliability of the whole European power grid", said EIB Vice-President Wilhelm Moltere.

As well as Obervermuntwerk II, the EIB loan will also finance construction of the smaller 13MW Rellswerk plant and reinforcement of the Bürs substation. Completion is scheduled for 2018.