The Drina River forms the border between Serbia and Bosnia and Herzegovina. Its hydropower potential for electricity generation was identified a long time ago. A number of hydropower plants were therefore planned along the river.
In 1968 Serbia’s second largest hydropower plant was built near the small town of Bajina Basta. With a capacity of 340 megawatts it still generates a significant portion of the electricity consumed in Serbia. After almost 40 years of uninterrupted operation, however, at the turn of the millennium it became apparent that crucial components of the plant were in urgent need of renewal. KfW Entwicklungsbank is supporting the Republic of Serbia in securing this eco-friendly source of energy for another 25 to 30 years.
Good For the Environment, the Climate and the Economy
By supporting Serbia’s state power utility EPS in revitalising the Bajina Basta Hydropower Plant, KfW Entwicklungsbank is contributing to Serbia’s economic growth as well as to protecting the environment and the climate. As an energy source, water is renewable and clean. Hydropower plants release no carbon emissions. Moreover, the Bajina Basta Hydropower Plant plays a special role in the country’s electricity supply. It is used not only for base load generation but also to meet peak load demand and regulate grid frequency.
The revitalisation of the hydropower plant costs around 65 million euros. Part of the capital expenditure is being financed by a loan of up to 30 million euros provided by KfW and subsidised by the Federal Ministry for Economic Cooperation and Development (BMZ). The remaining 35 million euros is being provided by EPS from its own sources. The funds are being used for the renewal of the electromechanical equipment of the hydropower plant. Without this extensive capital expenditure, whole generator sets would break down in the years ahead – with serious consequences for Serbia’s electricity supply.
The revitalisation measures were put out to international public tender. The contract was awarded to the Austrian firm VA Tech Hydro GmbH. The work is taking a total of four years because the plant must continue operating over the entire construction period, so the renovation work can only be performed step by step, one generator unit per year. The first revitalised generator was brought back online in the summer of 2010. The other three will follow, so that after the project has been completed the hydropower plant will be able to generate clean electricity for at least another 25 years.
