LONDON (Reuters) -The European Bank for Reconstruction and Development said on Thursday it is lending 22.3 million euros ($26.0 million) to a Ukrainian energy firm as part of a pipeline of deals, signalling its ongoing support for the sector despite a corruption scandal.
The EBRD cash will go to private Ukrainian energy company Power One to finance new gas-piston power plants and battery energy storage systems, the lender said in a statement.
An investigation into an alleged $100 million corruption scheme centred on nuclear energy has stoked anger at Kyiv’s wartime government under President Volodymyr Zelenskiy, which has relied on donor funding since Russia invaded in 2022.
The alleged plot involves efforts to control procurement at nuclear agency Energoatom and other state enterprises which were not identified. The EBRD has not provided financing to Energoatom since a 2013 300 million-euro loan was fully disbursed in 2019.
The new loan is part of overall lending of roughly 1 billion euros this year to help Ukraine rebuild its power sector and improve energy resilience. The country has been working to decentralise its power capacity by using more solar, wind and small modular gas turbines.
Russian attacks on Ukrainian energy targets intensified in October, and the EBRD estimates that Ukraine has lost roughly 9,000 megawatts of generation capacity and 90% of its flexible generation since the start of the war, intensifying economic headwinds and causing regular rolling blackouts.
The EBRD, the largest institutional investor in Ukraine, has deployed more than 8.5 billion euros since the invasion. It said it aims to sign two other “major” deals later this year. The multilateral lender mainly invests in private sector firms through loans, equity investments and guarantees.
($1 = 0.8575 euros)
(Reporting by Libby George, editing by Karin Strohecker and Philippa Fletcher)
