The European Bank for Reconstruction and Development (EBRD) said it is considering extending a loan of Euro 28 million (Dollar 27.4 million) to French renewables company Voltalia for the construction and operation of the 140 MW Karavasta solar power plant in Albania.

The provision of the loan is expected to be approved on November 2, the EBRD said in a project summary document on Thursday.

The project, which is valued at Euro 125 million, is implemented by Karavasta Solar LLC, a special purpose firm established in Albania by Voltalia.

Voltalia started the construction of the Karavasta park in early July. The solar power plant is expected to be commissioned in the second half of 2023.

Voltalia signed a 30-year concession contract with Albania's government to build and operate the Karavasta solar power plant in 2020.

According to EBRD, the project will contribute to climate mitigation by meaningfully increasing the share of solar power generation in Albania and will promote further private participation in the sector.

“The transition impact arises from delivering climate mitigation benefits through the construction of 140 MW of additional renewable energy generation capacity in Albania,” the bank said, adding that the international tender that has led to the project is unique in that it is promoting development of local energy markets by requiring the project to have 50% of its output exposed to energy market dynamics.

“Successful implementation of the Project is expected to have a very significant demonstration effect for investors and finance institutions looking to support renewables in the Western Balkan region,” the EBRD said.

Meanwhile, last week, the Minister Infrastructure Belinda Balluku said that Albania will build wind parks to start producing energy.

Balluku announced that all interested companies can now place their bids.

Albania is looking to boost its energy production levels from sustainable sources and according to minister Balluku there are several international companies eyeing investment in this sector.

“A second auction, after that of the photovoltaic implants, come the wind farms. On June 9, my team from the ministry, with the presence of the EBRD team, opened the first phase where interested parties can express their interest in connection with the development of the 100 megawatts parks in Albania. Until now there are 9 participants”, Balluku said.