EDF Renewables, a global market leader in renewable energy, and Canadian Solar Inc. one of the world's largest solar power companies, recently announced their jointly-owned 399 MWp Pirapora solar complex in Brazil has successfully raised a total of 1.39 billion Brazilian reais (US$373 million) via multiple project finance sources. EDF Renewables owns 80% of the complex while Canadian Solar owns the remaining 20% stake.
The 191.5 MWp Pirapora I solar power project raised 220 million Brazilian reais (US$59 million) of infrastructure debentures through private placement to accredited institutional investors. The debentures have a tenor of 16 years and are guaranteed by the Inter-American Development Bank and IDB Invest, the private sector arm of the IDB Group.
Fitch Ratings assigned the debentures ratings of A+ (Global) and AAA (Brazil), with stable outlook. This innovative issuance marks the first debenture of a solar project in Brazil to be assigned a global investment grade rating. This also marks IDB group's first structured credit guarantee product for solar in Brazil. BTG Pactual acted as a financial advisor to the sponsors for this transaction. Proceeds of this issuance will be used to repay a construction bridge loan provided by IDB. As previously announced on August 7, 2017, the project also received an 18-year financing from the Brazilian Development Bank in the amount of 529 million Brazilian reais. This structure is the result of an innovative partnership between BNDES and IDB, which could stimulate the financing of other renewable energy projects in the country.
In addition, the 115 MWp Pirapora II solar power project closed long-term project financing of 366 million Brazilian reais (US$99 million) from Banco do Nordeste and the Northeast Constitutional Fund.
Adjacent 92.5 MWp Pirapora III solar power project has secured long-term project financing of 271 million Brazilian reais (US$73 million) from BNDES and the Brazilian National Climate Fund.
"These financings demonstrate the huge interest of leading financial institutions in the development of large scale solar energy infrastructure in Brazil," commented Dr. Shawn Qu, Chairman and Chief Executive Officer of Canadian Solar. "The high quality of the projects and the solidity of the sponsors were determinant to structure this important funding" – added Paulo Abranches, Chief Executive Officer of EDF Renewables in Brazil.
The Pirapora projects, operational since mid-2018, are among the largest solar complexes in the Latin America region. The three plants are powered by approximately 1,235,000 high-efficiency CS6U-P modules manufactured by Canadian Solar in Sao Paulo State, Brazil.
Solar energy generated from these projects are fully contracted with 20-year inflation-linked power purchase agreements.
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