📋 Tender Overview
The Japan Bank for International Cooperation (JBIC; Governor: HAYASHI Nobumitsu) signed on April 26 a loan agreement in project financing*1 amounting to up to approximately EUR43 million (JBIC portion) with Eavor Erdwärme Geretsried GmbH (Eavor Geretsried) in Germany, which is invested in by Chubu Electric Power Company, Incorporated, for a geothermal power generation and district heat supply project. The loan is co-financed with the European Investment Bank, Mizuho Bank, Ltd., and ING Bank N.V., bringing the total co-financing amount to approximately EUR131 million. Nippon Export and Investment Insurance (NEXI) will provide the insurance for the loan by the private financial institutions. JBIC will provide the loan through its Special Operations Account*2.
This is the first commercial project for Eavor Geretsried to use its closed loop geothermal technology*3. It will build, own, and operate a geothermal power generation plant with a total generation capacity of approximately 8.2MW (a thermal output of approximately 64MW) in Bavaria, Germany. By drilling closed loops approximately 5,000 meters underground and circulating water through them, it will efficiently extract underground heat for electrical power generation and supply heat to the district.
The EU Innovation Fund also has decided to support the technology. It recognizes that it will not only significantly reduce greenhouse gas emissions during its operation, it will also contribute to the stable supply of renewable energy-derived power and heat in Europe.
The EU has set achieving carbon neutrality by 2050 as one of the most important issues and is promoting wider use of renewable energy. The German government has set the goal of increasing the proportion of renewable energy in the country’s total electricity consumption to 80% by 2030. In terms of heat supply, the government requires that at least 65% of energy should be derived from renewable sources for all heating equipment installed in newly developed areas, such as residential and industrial sites. The project conforms with these energy policies of the EU and the government of Germany.
In the Strategic Energy Plan, released in October 2021, the government of Japan clearly stated it would develop new innovative technologies to drastically expand the introduction of geothermal power generation by 2050, based on the potential of geothermal resources in Japan. Also, in the Infrastructure System Overseas Promotion Strategy 2025, supplemented in June 2023, the government of Japan in its support of the transition to carbon neutrality and decarbonization established a policy of providing support for quality energy and electricity infrastructure that harnesses sophisticated technologies to reduce the burden on the environment in a way that is compatible with the energy policy of host countries. The loan is in line with this policy and will financially support an overseas infrastructure project that a Japanese company has
