Neoen closes financing for 140 MWp of solar in El Salvador

French renewable energy company Neoen has secured a syndicated credit facility for its 140-MWp Capella solar project in El Salvador, thus reaching financial close on the scheme.

The senior loan is being provided by Dutch development bank FMO, IDB Invest, the private sector arm of the Inter-American Development Bank (IDB), and French development finance institution Proparco. FMO, which together with IDB Invest is acting as co-lead arranger for the facility, said on Thursday that the funds will be used for building the solar park and installing a 3 MW/1.5 MWh LG Chem lithium-ion battery facility.

The total estimated cost of the project stands at USD 143 million (EUR 125.7m).

The Capella solar park, Neoen’s second project in El Salvador, is planned to become operational at the start of 2020. A tie-up comprising TSK of Spain and France-based Gensun will take care of the plant’s construction, while the energy storage system will be installed by Japan's Nidec Corp (TYO:6594).

The project has in place a 20-year power purchase agreement (PPA) with local power distribution firms Delsur, AES, EDESAL and B&D. Power will be sold at a price below grid parity of USD 49.6 per MWh. Neoen secured the scheme in a public tender held in 2016.

(USD 1.0 = EUR 0.879)

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