An original US$106M loan was approved by the Bank back in June 2005 for a project to improve the reliability, efficiency, and safety of UkrHydroEnergo hydraulic structures and equipment, as well as improving their environmental performance. The latter will be achieved through the reduction in emissions of greenhouse gases, the installation of nonpolluting turbine runners, and the elimination of oil leaks into Dnipro and Dnister Rivers.

The project will eventually add a further 400MW capacity to the Dnipro Hydropower Cascade, increasing its production by about 500GWh. The project also pioneered the concept of Carbon Financing in the Ukraine as it was the first Joint Implementation Project under the Kyoto Protocol in the country. The additional financing approved yesterday supports the rehabilitation of three hydroelectric units in the Dniprovska 2 hydro plant and three hydroelectric units in the Kremenchug hydro plant.

“The reform and modernization of the energy sector is a key pillar of Ukraine’s sustainable economic development,” said Martin Raiser, World Bank Country Director for Ukraine, Belarus and Moldova. “We are very pleased to be able to continue to support UkrHydroEnergo in its efforts to increase the efficiency of the unique Dnipro cascade and thereby ensure Ukraine has access to cheap, reliable, and clean power.”