EIB to provide $182m loan for combined cycle power plant in Poland

The European Investment Bank announced recently that it is providing a loan of $182 million for a joint venture, including Polish utility Tauron and state-owned national gas and oil company PGNiG to build a 450-MW CCGT power plant in the southeastern industrial city of Stalowa Wola. Another $182 million in loans from the European Bank for Reconstruction and Development was announced last month.

The facility, with a total cost of $486 million, is expected to open in late 2015. It will also provide 240 MW of thermal output for heating homes in the city of 65,000 while operating at a thermal efficiency of 60 percent -- one of the highest ratings in Europe.

EIB officials said the plant will serve as a demonstration for the feasibility of using CCGT technology to help Poland reach its goals of reducing its dependence on coal for electricity generation. The country currently uses obsolete, inefficient coal-fired power units from the 1950s and 1960s for 90 percent of its electricity needs. Its continued reliance on coal has put it at odds with the European Commission, which is seeking to develop binding greenhouse gas reduction goals for beyond 2020 to counter global warming.

Stalowa Wola has four coal-fired units producing a total of 250 MW and the new project, to be built next door, would become Poland's biggest CCGT project. Government officials estimate the new unit will produce about 3,500 gigawatt-hours of electricity per year while consuming 600 million cubic meters of natural gas annually and eliminating 100,000 tons of coal consumption.