Czech solar power company Solek has reached a funding agreement with several banks and investors to provide US$379 million for its solar power portfolio in Chile.
The funds will be used to complete work at three projects currently under construction, the Tutuven, Cauquenes and El Conquistador facilities. The financiers include investment banks BNP Paribas and Natixis, both based in France, and their investments will include a US$178 million private placement and a US$55 million loan for Pequeños Medios de Generación Distribuida (PMGD) projects.
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These PMGD projects are distributed renewable power projects, the governance of which was reformed by the Chilean government in 2022. The government defines a PMGD as a power project with a capacity of no more than 9MW, and PMGDs can benefit from a number of perks, including automatic access to the national grid and reductions in transmission tolls. While the future of this legislation remains unclear, it has encouraged investment in the sector in recent years.
“In aggregate, Natixis has financed or arranged approximately US$1.8 billion to support the development of PMGD renewable power generation projects in Chile,” said Aitor Alava, managing director and head of infrastructure and energy finance in Latin America at Naxis.
“We look forward to continuing to support the sponsor in its growth in the region and to support Chile’s continuous efforts toward energy transition,” added Alava.
Similarly, Solek has invested heavily on distributed power in Chile, opening the majority of its small-scale projects in recent years. Solek manages 17 solar projects in Chile that began operation in 2021 or later, compared with ten that began operation before 2021, and projects such as the El Conquistador facility fit this mould of distributed generation. The project has a capacity of 2.99MW, the same as the company’s Colchagua facility, which was completed in 2022.
In recent years, Solek has developed a number of solar projects to meet a number of ambitious production targets. The company’s Chilean projects have a combined capacity of 284MW, and its aims to expand this to 400MW across its global operations by the end of this year. Solek has already announced plans to build more than 38 new solar projects in Chile by the end of 2024.