EBRD lends EUR 160m to Ukrnafta for distributed power generation

EBRD lends EUR 160m to Ukrnafta for distributed power generation

The European Bank for Reconstruction and Development (EBRD) has announced a significant financial commitment to support Ukraine's decentralized energy supply. The bank has agreed to lend EUR 160 million to Ukrnafta, a Ukrainian state-owned oil and gas company, to expand its distributed energy generation capacity. This follows a previous loan of EUR 80 million provided last December to install around 100 MW of distributed power [1].

The new loan will enable Ukrnafta to install an additional 250 MW of gas-fired generation facilities, bringing the total capacity to 350 MW. This investment is part of a broader strategy to bolster Ukraine's power sector resilience in the face of ongoing Russian attacks. The project is also expected to benefit from EUR 121 million in grants from external donors, with Sweden's Swedfund contributing a EUR 1 million grant for technical assistance [1].

Decentralizing Ukraine's energy system is a critical priority, given the country's current operating capacity is around one-third of its pre-war levels due to Russian attacks. This has led to widespread power disruptions and rolling blackouts, significantly impacting the lives of millions of Ukrainians. The EBRD's Managing Director for Ukraine and Moldova, Arvid Tuerkner, expressed pride in deepening this cooperation, stating, "We are proud to deepen this cooperation, allowing us to help the Ukrainian power sector become more resilient" [1].

While the immediate goal is to provide supplementary energy during the current crisis, the long-term vision includes integrating these gas-fired engines into Ukraine's renewable energy strategy. The project also includes workforce management and leadership training programs, as well as a veteran rehabilitation program, aligning with the EBRD's Gender SMART approach [1].

Since the invasion in 2022, the EBRD has committed over EUR 7 billion to Ukraine, with over EUR 2.4 billion dedicated to supporting the energy sector. The bank's priority investment areas include energy security, vital infrastructure, food security, trade, and the private sector [1].

References:
[1] https://www.ebrd.com/home/news-and-events/news/2025/ebrd-supports-decentralisation-of-ukraine-power-supply.html