Huge solar plant to be built in Chile
Worldwide solar energy services provider SunEdison Inc. announced the closing of a $100.4 million non-recourse debt financing arrangement with the Overseas Private Investment Corp. (OPIC), the U.S. Government's development finance institution and IFC, a member of the World Bank Group.
The debt proceeds will be used in Chile for the construction of a 50.7 MWp solar power plant, to inject energy directly into the Central Interconnected System (SIC), selling all its production in the spot market (merchant solar).
OPIC is providing $62.9 million of debt, IFC is providing a parallel loan of U.S. $37.5 million and Rabobank is providing a local Chilean Peso VAT facility for the equivalent of U.S. $25.6 million.
Interconnection of the 50.7 MWp plant is expected to take place during the first quarter of 2014. Once completed, the project, called "San Andres" and located in the Atacama region, is set to become the largest solar photovoltaic merchant plant in Latin America in 2014 and one of the largest in the world.
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“OPIC is excited to support this landmark project which will help Chile take advantage of its solar potential, increase access to energy, and create local jobs,” said Elizabeth L. Littlefield, OPIC president and CEO. “This is an important renewable energy project for OPIC in Chile and we look forward to advancing it while continuing our strong partnership with SunEdison.”
“This project proves that with the right sponsors, domestic environment and financiers, debt financing has become a viable option for merchant solar plants. IFC's support is a continuation of our strategy to promote commercially competitive renewable solutions in Chile and the wider region,” said Jean Philippe Prosper, IFC vice president for Sub- Saharan Africa, Latin America and the Caribbean.
“When completed, San Andres will be the one of the first merchant PV plants and will demonstrate that solar photovoltaic is already a competitive energy source in countries like Chile,” said Pancho Perez, SunEdison president for Europe, Middle East, Africa and Latin America. “This project reinforces SunEdison's leadership in the Latin American renewable energy market and reaffirms our commitment to clean energy industry development in Chile.”
Drax advances biomass strategy with Pinnacle acquisition
The Group’s enlarged supply chain will have access to 4.9 million tonnes of operational capacity from 2022. Of this total, 2.9 million tonnes are available for Drax’s self-supply requirements in 2022, which will rise to 3.4 million tonnes in 2027.
The £424 million acquisition of the Canadian biomass pellet producer supports Drax' ambition to be carbon negative by 2030, using bioenergy with carbon capture and storage (BECCS) and will make a "significant contribution" in the UK cutting emissions by 78% by 2035 (click here).
This summer Drax will undertake maintenance on its CfD(2) biomass unit, including a high-pressure turbine upgrade to reduce maintenance costs and improve thermal efficiency, contributing to lower generation costs for Drax Power Station.
In March, Drax secured Capacity Market agreements for its hydro and pumped storage assets worth around £10 million for delivery October 2024-September 2025.
The limitations on BECCS are not technology but supply, with every gigatonne of CO2 stored per year requiring approximately 30-40 million hectares of BECCS feedstock, according to the Global CCS Institute. Nonetheless, BECCS should be seen as an essential complement to the required, wide-scale deployment of CCS to meet climate change targets, it concludes.