Latin Finance grants award to the best financing structure for renewable energy projects in Peru
An investment in wind-powered projects in Peru received international recognition as best financing for renewable energy projects in Latin America
The construction of a double wind-powered park in Peru, to date, the largest in the country, received the award for best renewable energy project in Latin America in 2015. This award is granted by Latin Finance, the publication that grants awards to the best financing structures to different sectors in the region.
The project, in line with the government's strategy of increasing the presence of renewable energies in the country's energy matrix, consists in the construction of the Marcona wind-powered park in southern Lima, which started operation in April of 2014, and the Tres Hermanas wind-powered park which will start operations toward the end of 2015. Once in operation, the combined projects will have an installed capacity of 129MW (32MW in Marcona and 97 MW in Tres Hermanas). These projects will contribute electricity generation capacity and will diversify Peru's energy supply.
In addition, the wind-powered complex will prevent about 428,000 tons of CO2 to be dumped per year, thus contributing to the proliferation of renewable energy projects which will gradually reduce the dependence on contaminating sources such as oil.
Ignacio Fombona, Director of Financial Advice at CAF, co-leading organization in the project's financing structure, explained, "This type of energy contaminates less, helps diversify the country's energy generation, and provides Peru with a greater capacity to generate electric energy".
On the one hand, the organization acted as co-adviser to the project's promoter (Cobra Group) for the financing structure, and on the other, as a subordinate moneylender. In addition, CAF contributed close to USD 30 million for a bridge loan that helped finance the project while the long term financing was processed. The project required a total financing of approximately USD 227 million, of which USD 207 million correpond to a senior loan granted by US ExIm, Proparco, FMO, DEG, Natixis and Hyundai Power Private Special Asset Unit Trust, and USD 20 million to the subordinate loan granted by CAF.
Fombona highlighted, "This transaction is proof that there are long-term financing sources for projects that contribute to fight against climate change, with attractive terms and conditions from an economic point of view. The projects are examples of the fact that renewable energies may be profitable from both an economic and environmental point of view".
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