The proposed transaction consists of a loan to Companhia de Saneamento Básico do Estado de São Paulo (Sabesp) S.A. (“Sabesp”) in support of the installation of: (i) five water quality restoration units for use in informal areas (“URQs”) in the Pinheiros River basin, specifically: URQ Jaguaré, URQ Antonico, URQ Pirajussara, URQ Água Espraiada and URQ Cachoeira; and (ii) up to 32 small solar power plants (“UFVs”) with power ratings below 5 MWp and a total of 73 MW of installed capacity, to be installed in areas of the state of São Paulo where Sabesp has operations, thereby contributing to the expansion of production of renewable energy and diversification of the Company’s energy matrix (the “Project”).
The URQs will be installed in the Pinheiros River basin, in a densely populated and heterogeneous urban environment. The selected sites are near low-income neighborhoods and areas with informal settlements, where the installation of sanitary sewer system would be unfeasible due to the extreme complexity of the actions that would have to be taken as well as the impossibility of constructing central sewers and mains at those sites. The UFVs, however, will be installed in Sabesp operating areas in the interior of São Paulo State. Most of these areas already have wastewater treatment plants (WWTPs) of the stabilization pond type and idle tracts of land available that are suitable for installation of UFVs.
This means that the Project will contribute to the reduction of pollutant loads originating in sites that lack sewer systems and will improve environmental quality in the Pinheiros River basin. The project will also increase the energy efficiency of Sabesp as a whole. The UFVs will be able to supply approximately 60 percent of the power consumed at low voltage, or 4.5% of all electricity used at the Company, thereby curbing greenhouse gas emissions associated with use of electric power.