Company name
Greenwind S.A.
Project number
12064-01
Category B projects have potential environmental and/or social impacts and risks that are less adverse than those of a Category A and which are generally limited to the project site, largely reversible and can be mitigated via measures that are readily available and feasible to implement in the context of the operation.
E&S category
B
Country
Argentina
Sector
Energy
Status
In implementation
Disclosed date
12/13/2016
Projected date at which a project will be put forward for the Board of Executive Directors’ approval.
Projected board date
06/06/2017
Approval date
06/06/2017
Signed date
09/27/2017
Sponsoring entity
Pampa Energia S.A.
Investment Operations Department Contact
N/A
Investment type
Syndicated amount
USD $ 72,500,000
Financing amount
USD $ 50,000,000
Currency
USD
Project scope and objective
El Corti wind power project (the “Project” or “El Corti”) will add 98.6 MW of renewable energy to the Argentinean electricity system, thus directly supporting the Government of Argentina’s (“GoA”) priorities to ensure a stable long-term electricity supply and the diversification of its energy matrix with the expected addition of 2.7 GW from renewables sources by 2018. The Project consists of the construction, operation and maintenance of a 98.6MW wind farm, its associated facilities, to be located south of the province of Buenos Aires, 17km northwest of the city of Bahia Blanca, Argentina. The Project will sign a 20-year power purchase agreement (“PPA”) with the wholesale electric market administrator (“CAMMESA”) to inject energy to the national interconnection system (¨SADI¨) via the 500KV-132KV Bahia Blanca substation, at a bidding price of US$59.36/MWh increased annually by an adjustment factor. Electrical studies were presented to the relevant authorities, which provided a favorable opinion to the Project´s interconnection specifications for the assigned node. The Borrower is expected to enter into a turn-key EPC contract covering civil works, equipment and turbines from a first-tier manufacturer and a long-term O&M contract for at least the life of the IDBG loan. It has an estimated 18-month construction period, with construction starting by the first quarter of 2017. Wind resource has been assessed by DNV based on on-site wind measurements from 2009 up to 2013, with average wind speeds of 8.9m/s at 93m hub height. The Project has a capacity factor of 51.8% and estimated annual energy production at P50 of 402.9GWh/year, with expected 4,537 equivalent hours.
Transaction Structure and Financing Highlights. The estimated total cost of the Project is of up to US$175.0 million, which will be financed through an IDBG A loan of up to US$50 million. The financial plan will be completed with the participation of two other lenders, from the bilateral financial institutions or export-credit agencies, as well as equity contributions for a 75/25 debt-to-equity ratio. The Project will be required to meet the customary debt sizing criteria applied to wind projects, DSCR 1.30x for P9010-years and 1.00x for P991-year. The IDBG loan is expected to have a tenor of up to 15 years door-to-door. The project will have the security package customary for this type of project finance transactions.
Development Impact. The Project will have positive developmental impacts, such as: (i) adding 98.6 MW of renewable capacity to the Argentinean grid, representing 15% of the total NCRE installed capacity, thus decreasing thermal and hydro generation reliance and contributing to the 20% goal of NCRE by 2025; and (ii) displacing approximately 198,226 equivalent tons of carbon emissions per year. Financial additionality is strong as the tenor of the financing is 15 years door to door, a long tenor that is critical for the financial viability of this type of infrastructure projects, and which is simply not available in the local capital markets[1]. Commercial banks have not structured long-term project financing transactions in Argentina for the last 10 years and hence the participation of multilateral and bilateral agencies in this first round of the RenovAR program will be key to its success.
[1] Source: Dealogic Project Finance Database
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Contact information
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Client Contact
N/A
PHONE NUMBER
N/A
POST OFFICE ADDRESS
N/A
IDB Invest Contact
requestinformation@idbinvest.org
PHONE
+1(202)-566-4566
ADDRESS
1350 New York Ave NW, Washington, DC 20005
COUNTRY OFFICES
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Environmental and social review
IDB Invest conducts an environmental and social due diligence (ESDD) commensurate with the nature, scale, and stage of the project, and with its level of environmental and social risks and impacts. The ESDD will confirm the project E&S categorization and assess the project with respect to the client requirements in IDB Invest Environmental and Social Sustainability Policy. The results of the ESDD, including any identified gaps are described in the Environmental and Social Review Summary (ESRS) provided below. For projects approved as of 2016, any gaps with respect to IDB Invest's Environmental and Social Sustainability Policy at the time of the ESDD are addressed in the Environmental and Social Action Plan (ESAP) presented below, to comply with the date mentioned above.
ENVIRONMENTAL AND SOCIAL REVIEW SUMMARY
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