NIB will provide a loan for Landsvirkjun to finance a new hydropower project in Búðarháls, southern Iceland. The 16-year maturity loan totalling USD 70 million (EUR 52.5 million) will help build the new hydropower plant expected to produce 585 GWh of electricity annually.

The intake reservoir of the power station will be formed with a 2.1 km-long dam over the Köldukvísl river. The Búðarháls hydropower plant is planned to be finalised in 2014.

"Renewable energy is one of the cornerstones for the Icelandic economy. The country has a lot of unutilised potential in terms of renewable energy, and this potential can be realised by the implementation of capital-intensive, long-term projects, typical for energy projects," says Johnny Åkerholm, NIB President and CEO.

"Energy is a focus sector for NIB. Securing access to reliable clean energy supply in our member countries is at the core of NIB's mandate. With this loan, the Bank will help Iceland to produce more sustainable energy in the form of hydropower," Mr Åkerholm adds.

Tags: Landsvirkjun