28 November 2024
- The loan will enable Nortegas Renovables to advance in the development of renewable gases from waste to be injected into the existing gas grid.
- The project will boost biomethane production in Spain, helping to decarbonise the country and to develop the local economy.
- The operation will help to achieve the goals of the REPowerEU plan to increase energy security in the European Union and speed up the green transition.
- This loan is backed by InvestEU, the flagship EU programme aiming to mobilise investment of more than €372 billion by 2027.
The European Investment Bank (EIB) has granted Nortegas Group a framework financing of up to €80 million to enable group subsidiary Nortegas Renovables to finance the construction of biomethane plants in Spain and launch a digital operations centre.
The EIB and InvestEU-financed project will enable the development of the first phase of Nortegas Renovables’ strategic plan, which aims to generate up to 3.5 TWh/year by 2030. Meanwhile, the launch of the digital operations centre will provide innovative waste management solutions by applying cutting-edge technology and digitalising the group’s plants.
The primarily medium-sized investments set to receive financing will produce renewable biomethane to be injected into the existing natural gas network, replacing fossil fuel-derived natural gas and taking advantage of existing distribution infrastructure. The plants will use agricultural waste – mainly livestock manure from surrounding farms – and, to a lesser extent, organic by-products from agribusiness and vegetable waste. The Spanish government’s guarantee of origin system will certify the sustainability of the source of the biomethane provided and the related greenhouse gas emission savings.
The production of biomethane from the project will help reduce direct greenhouse gas emissions from agricultural activity, lower the risk of direct emissions’ release into air and water associated with livestock production and contribute to the security and diversification of energy supply in the EU, reducing the EU’s dependence on fossil fuels such as natural gas.
EIB Group President Nadia Calviño said: “The EIB is backing innovation and the development of new green fuels, which are key to the energy transition, decarbonisation and European industrial competitiveness. This investment consolidates Spain’s position as the country of renewables”.
European Commissioner for the Economy Paolo Gentiloni said: “The InvestEU programme supports investments that strengthen energy security and reduce greenhouse gas emissions, driving forward the green transition across Europe. This agreement exemplifies these goals, representing a transformative step in Spain’s renewable energy landscape by multiplying the country’s current biomethane production capacity. Thanks to this agreement, we are not only advancing energy security and supply diversification but also reinforcing our commitment to sustainability and the circular economy. Initiatives like these bring us closer to a cleaner, more resilient energy future while creating jobs and bolstering economic growth for all EU citizens”.
Commissioner for Energy Kadri Simson said: “I welcome this agreement to increase the biomethane production capacity in Spain. It will help the EU with the energy transition and decarbonising the gas market, supporting the REPowerEU plan’s objective to end Europe’s dependency on fossil fuel imports. Biomethane can immediately start replacing natural gas, and it is produced here in Europe, creating jobs, growth and benefiting local communities by increasing their energy security, for example. The production of biomethane has accelerated in Europe during the past years, and we need to keep up pace. Therefore, the EIB and Nortegas framework loan agreement is particularly good news.”
The project highlights the EIB’s commitment to economic, social and territorial cohesion, as most of the funds will be invested in cohesion regions where per capita income is below the EU average and where there is a risk of depopulation.
“This credit line gives us visibility in implementing our plan to generate 3.5 TWh/year by 2030, strengthening Nortegas Renovables’ long-term strategy as a developer and operator of biomethane assets and thereby contributing to decarbonisation and energy supply security in Spain,” said Nortegas Renovables General Manager Felipe Requejo.
“We are proud that the EIB has trusted us with its first biomethane financing operation in Spain. Its support for the development of this renewable gas – a key pillar of Nortegas’ strategic plan – boosts the potential of Spain’s natural gas networks to decarbonise our customers’ heating applications and underscores its importance to the energy transition,” added Nortegas CEO Javier Contreras.
This €80 million framework financing is part of the EIB action plan to support REPowerEU, a programme to improve the European Union’s energy security and speed up the green transition. It is also backed by InvestEU, an EU programme to mobilise over €372 billion in additional investment from 2021 to 2027.
The EIB and energy security
In 2023, the EIB Group signed more than €21 billion in financing for energy security in Europe. In the same year, it allocated €4.513 billion to this goal in Spain, financing projects in areas including renewable energy, energy efficiency, power grids and storage systems. These investments are helping Europe speed up its transition to sustainable energy and reduce its reliance on fossil fuel imports.
In July 2023, the EIB Board of Directors raised the amount earmarked for REPowerEU projects to €45 billion. REPowerEU is the plan designed to end Europe’s dependence on fossil fuel imports. To boost financing for the EU manufacturing industry, the EIB will also expand the range of eligible sectors to include leading strategic technologies with net-zero carbon emissions, as well as extraction, processing and recycling of critical raw materials. The additional financing will be disbursed between now and 2027. In total, it is expected to mobilise more than €150 billion in investment in the target sectors.
Find out more about EIB support for the energy sector here.
European Investment Bank
The EIB is the long-term lending institution of the European Union, owned by the Member States. It finances investments that further EU policy objectives. EIB projects bolster competitiveness, drive innovation, promote sustainable development, enhance social and territorial cohesion, and support a just and swift transition to climate neutrality.
The EIB Group, consisting of the EIB and the European Investment Fund, reported total financing signatures in Spain of €11.4 billion in 2023, approximately €6.8 billion of which went to climate action and environmental sustainability projects. The EIB Group signed a total of €88 billion in new financing in 2023.
InvestEU
The InvestEU programme provides the European Union with crucial long-term funding by leveraging substantial private and public funds in support of a sustainable recovery and growth. It also helps mobilise private investments for the European Union’s policy priorities, such as the European Green Deal and the digital transition. The InvestEU programme brings together under one roof the multitude of EU financial instruments currently available to support investment in the European Union, making funding for investment projects in Europe simpler, more efficient and more flexible. The programme consists of three components: the InvestEU Fund, the InvestEU Advisory Hub and the InvestEU Portal. The InvestEU Fund is implemented through financial partners that will invest in projects using the EU budget guarantee of €26.2 billion. The entire budget guarantee will back the investment projects of the implementing partners, increase their risk-bearing capacity and thus mobilise at least €372 billion in additional investment.
Nortegas
Nortegas Group is playing a key role in the sustainable energy transition by developing renewable gases and preparing its infrastructure to transport this kind of gas alone by 2050. This initiative strengthens Nortegas’ strong commitment to the energy transition, digitalisation and the circular economy, encouraging the widespread use of clean and sustainable fuels and promoting renewable gas-related initiatives and activities.
Nortegas views biomethane, green hydrogen and digitalisation as the focal points of its strategy and the transformation of its business model. It is positioning itself as a leader in tackling the energy landscape’s most pressing challenges.
Nortegas Renovables is the Nortegas Group subsidiary focusing on the development of biomethane production projects in Spain.
Source – EIB