Grenergy Closes Financing on Two Wind Farms in Peru 

Grenergy, the Spanish company producing energy from renewable sources and specialist in the development, construction and operation of photovoltaic and wind power projects, has just signed a financing agreement of $40 million  (about €35.5 million) with  the Latin American Development Bank (CAF) and the Instituto Oficial de Crédito (ICO), for the construction and development of two wind farms in Peru.
Grenergy Closes Financing on Two Wind Farms in Peru 
Courtesy of NREL

This Project Finance includes the financing of the senior debt without recourse -which is linked only to the asset and limits the risk for the debtor- and represents the first renewable energy project that the ICO finances in Peru. On the other hand, Sinia Renovables, a company specialising in energy projects whose capital is 100% controlled by Banco Sabadell, enters both parks with a 10% stake.

The Duna and Huambos wind farms, which will have an installed capacity of 36.8 MW, will sell the energy produced for a period of 20 years to the Ministry of Energy and Mines of Peru, at a price of between 37.7 and 36.8 dollars per MWh, for an estimated annual production of more than 165 thousand MWh.

Both parks are located in Chota, province of Cajamarca -more than 2,400 meters above sea level-, and will be built by Siemens Gamesa, being the first in the highlands of Perú, a geographically strategic place for its exceptional weather conditions for the generation of this type of energy, as it has about 5,000 net hours of wind per year.

Likewise, its start-up -planned for the end of the second quarter of 2020- is part of the ambitious plan of the Peruvian Administration to cover 60% of the country's energy demand using clean energies by 2025 and electrify areas of difficult access. Precisely with this objective in mind, it called for a public auction in 2016 in which Grenergy won these wind power projects face to face with giants of the stature of Italy's Enel or France's Engie (GDF-Suez).

The Duna and Huambos wind farms reinforce Grenergy's position in Peru, a country where it has been present with its local headquarters since 2015. In addition, these projects represent another step in the consolidation of the company in Latin America and are part of the pipeline of solar and wind projects of 2,500 MW at different stages of development, diversified in strategic countries such as Chile, Peru, Mexico, Argentina and Colombia, without forgetting Spain, which is once again well positioned itself in the renewable energy sector. 

In addition, the operation comes at a time of exponential growth of Grenergy as reflected in its latest annual results presented to the market only a few weeks ago. The company earned 13.1 million in 2018 - 274% more than a year earlier - encouraged by the results of its Development and Construction division. It also grew its revenues by 16% to €55.5 million and tripled its EBITDA to €22 million.

According to Grenergy's CEO, David Ruiz de Andrés, "these projects in Peru demonstrate the capacity of renewable energies to supply clean energy at much more competitive prices than conventional energy and in areas where it does not even reach. Likewise, the development of legislation that allows the signing of long-term power purchase agreements or PPA's would undoubtedly contribute to improving the competitiveness of our sector in Peru".

Jorge Arbache, CAF's Vice President of Private Sector, said: "We are pleased to have led the financial structuring of this project, which allows CAF to fulfill its catalytic role in Latin America, not only by mobilizing external resources and channeling them to the region, but also by linking up with other prestigious international financial institutions such as ICO, which in this case is the first joint co-financing and in a sector as strategic for Peru as renewable energy.

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