Add us as your preferred source on Google to see more of our content in Search.
Add to Preferred SourcesIDB Invest, the private sector institution of the IDB Group, finances the construction and operation of Porto do Sergipe, a 1,516 MW combined cycle thermoelectric plant and its associated infrastructure in the state of Sergipe, in Brazil.
The project is developed by Centrais Elétricas de Sergipe SA (CELSE), a company run by EBRASIL of Brazil and Golar Power Ltd. Once operational in 2020, CELSE will sell electricity to 26 distribution companies in Brazil, becoming the largest and most efficient thermoelectric plant in Latin America and the Caribbean.
The IDB Invest financial package includes its own capital and mobilized financing, in reais and dollars, with a tenor of up to 15 years. The financing consists of three loans: one in local currency for up to 664 million Brazilian reais from IDB Invest, one in US dollars for $38 million also from IDB Invest and a loan of $50 million mobilized from the China Co-financing Fund for the Private Sector of the Americas.
The operation includes a $200 million loan from the International Finance Corporation and an innovative bond issue for approximately $1 billion in local currency at a fixed, long-term rate in international markets. The bond issue is guaranteed by SERV, the export and import credit agency of Switzerland.
The IDB Invest local currency loan represents the first time that the institution lends in reais at an interest rate linked to the Brazilian inflation index (IPCA). It is a key operation for the development of this type of infrastructure projects in the country, where revenues are received in local currency and adjusted based on inflation. The bond issue has attracted the interest of multiple international investors and opens the possibility to new forms of infrastructure financing in Brazil.
Sergipe will use natural gas as fuel, the fossil fuel with the lowest carbon emissions. Brazil can benefit from the abundance and historically low prices of this fuel internationally. The installed power of this plant will help the country increase its energy security while continuing to expand in renewable energy, such as solar and wind.
IDB Invest has collaborated with CELSE in the implementation of the best environmental and social practices for this project, with the aim of ensuring the sustainability of the investment and mitigating its impact.
Original source: IDB
Published on 19 April 2018