The European Investment Bank (EIB) has signed two green loans with Iberdrola totaling €108 million: a €50 million loan from its own funds and a €58 million loan from the Regional Resilience Fund (FRA). These funds will enhance the pumping capacity of the Valdecañas hydroelectric complex, comprising the Torrejón and Valdecañas power plants.
The upgraded complex will feature a total installed capacity of 225 MW, a 15 MW hybrid battery, and 7.5 MWh of stored energy. The combined battery and hydroelectric units will boost pumping capacity to a maximum of 313 MW and increase the Tajo system’s storage capacity to 210 GWh. The project utilizes existing infrastructure, including the Valdecañas and Torrejón-Tajo reservoirs and current transport networks, minimizing environmental impact.
Once operational, the complex is expected to reduce CO₂ emissions by 200,000 tonnes annually and create 165 direct jobs, with an additional 500 indirect jobs, thereby promoting skilled employment. The investment is located in a cohesion region, an area with per capita income below the EU average, contributing to climate action and regional economic development. Iberdrola
The project aligns with Spain’s Recovery, Transformation and Resilience Plan and the EU’s REPowerEU initiative, aiming to enhance energy security and reduce dependence on fossil fuel imports.
Reversible pumped-storage plants like Valdecañas act as “giant batteries,” storing potential energy in the upper reservoir during periods of excess generation and releasing it when needed, thereby stabilizing the electricity grid. This system operates in a closed loop, reusing water without consumption, and is independent of precipitation, offering long-term grid reinforcement.
The EIB, as the EU’s long-term lending institution, supports investments that align with EU policy objectives, focusing on climate action, digitalization, innovation, and territorial cohesion. In 2024, the EIB Group signed nearly €89 billion in new financing for over 900 high-impact projects, with a significant portion dedicated to climate-related initiatives.
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