The European Bank for Reconstruction and Development (EBRD) is helping to decarbonize fertilizer production and power generation in Uzbekistan by financing a pilot renewable hydrogen facility, Report informs referring to the EBRD website.
It will consist of a 20 MW electrolyzer and a greenfield 52 MW wind power plant.
The EBRD is offering a financial package of $65 million (58 million euros) to ACWA Power UKS Green H2 for the development, design, construction and operation of the facility. This special purpose company is jointly owned by ACWA Power (an international developer, investor, co-owner and operator of a portfolio of power generation and desalinated water production plants) and Uzkimyosanoat (UKS), a holding company of state-owned chemical enterprises in Uzbekistan.
The package consists of a $55 million (49 million euros) senior loan provided by the EBRD as well as concessional finance of up to $10 million (9 million euros) from Canada under the Special Fund for the High Impact Partnership on Climate Action (HIPCA). The EBRD is also planning to provide an equity bridge loan of up to $5.5 million (4.9 million euros) for the project.
“EBRD is proud to finance this landmark renewable hydrogen facility in Uzbekistan with our long-standing partner ACWA Power and their partner Uzkimyosanoat. This is the first of its kind across Central Asia, a region with some of the most carbon-intensive and hard-to-abate industries” said Nandita Parshad, EBRD Managing Director for the Sustainable Infrastructure Group, EBRD.
The plant will be the second renewable hydrogen production project financed by the EBRD following the Bank’s support for a renewable hydrogen facility in Egypt in 2022.
The project supported by the Japan-EBRD Cooperation fund, will help replace grey hydrogen, produced from natural gas and widely used in the production of ammonia fertilizer in Uzbekistan, with renewable hydrogen. The latter is recognized as a key alternative for decarbonizing the fertilizer production sector.
Once operational, the facility is expected to produce up to 3,000 tons of renewable hydrogen annually and to reduce annual CO2 emissions by around 22,000 tonnes.
HIPCA is supported by Austria, Canada, Finland, the Netherlands, South Korea, Spain, Switzerland, the TaiwanICDF, the United Kingdom and the United States.
Uzbekistan has been the leading recipient of EBRD funding in Central Asia for four years in a row. To date, the Bank has invested around 5 billion euros in 164 projects across the country, with most of those funds supporting private entrepreneurship.