Santo Domingo, Dominican Republic – January
16, 2018 — IFC, a member of the World Bank Group, with support from
the Government of Canada, has completed an $80 million financing
package for the construction and operation of a new, grid-connected, 50
megawatt wind farm to help diversify the Dominican Republic’s energy matrix
and ease its dependence on imported fossil fuels.
Parques Eólicos del Caribe (Pecasa) will be one of the Dominican Republic’s
largest wind farms and is expected to reduce greenhouse gases by about
91,000 tons CO2 equivalent per year, which is roughly comparable
to taking 20,000 cars off the road.
Pecasa is owned by Paris-based Akuo Energy SAS.
“As a country that is particularly sensitive to climate change, the Dominican
Republic has both a proactive policy to diversify its energy mix and implement
more sustainable economic development, and very abundant resources in terms
of renewable energy. Established in the region for many years now, in 2016
we thus decided to open a regional office there to act as a bridgehead
for our buoyant growth strategy in the Caribbean. The Pecasa funding ratified
today launches this growth cycle, and we are very proud to already have
the IFC by our side to support our expansion”, says Eric Scotto, CEO and
co-founder of Akuo Energy.
Fuel imports account for almost 80 percent of the Dominican Republic’s
energy needs. This dependence has led to high electricity prices, which
create a burden on the economy. Like many of its Caribbean neighbors, the
Dominican Republic is vulnerable to the environmental impacts associated
with fossil fuels and climate change, such as rising sea levels, coral
bleaching and changes in the frequency of tropical storms. It has set an
ambitious target to cut greenhouse gas emissions by 25 percent by 2030.
“Pecasa supports the Dominican Republic’s goals for ramping up renewable
energy with a new, low-carbon power source,” said Luc Grillet, IFC Senior
Manager for Central America and the Caribbean. “The project will help
the country’s competitiveness and reduce greenhouse gases. IFC looks forward
to continuing to support investments in the country’s power sector in
line with ongoing progress on the National Pact for the Reform of the Power
Over the past 25 years, the Dominican Republic has seen some of the strongest
economic growth in Latin America and the Caribbean. Investments in the
country’s energy sector are crucial to its sustained growth, and to improving
Dominicans’ standard of living. On average, energy demand has grown by
3.6 percent over the last five years.
Located on the country’s northern coast, about 260 kilometers from Santo
Domingo, Pecasa has a total project cost of $125 million and is expected
to become operational in the first half of 2019. IFC arranged a financing
package which includes $18.5 million for IFC’s own account, $18 million
from the Dutch Development Bank (FMO), $17 million from the IFC-Canada
Climate Change Program (a partnership between the Government of Canada
and IFC), $15 from million Proparco, the French development finance institution,
and $11.5 million from the German Investment Corporation (DEG).
Pecasa’s construction will be made possible thanks to the government of
Canada's instrumental contribution, which helped make the financing package
“At COP23, Canada and the UK launched the Powering Past Coal Alliance
for the phase down of coal-fired electricity. Using clean, renewable energy
is key to tackling climate change and creating good, middle-class jobs.
And the Government of Canada is proud to support this private-sector led
initiative which is helping the Dominican Republic reduce its reliance
on fossil fuels by adding wind power as an energy source," said the
Honourable Catherine McKenna, Canada's Minister of Environment and Climate
Pecasa will sell all its energy output to the government-owned power company,
Corporación Dominicana de Empresas Eléctricas Estatales (CDEEE), through
a dollar-denominated power purchase agreement for a 20-year term.
This IFC investment complements a $358 million program of the World Bank
and a group of development partners aimed at improving the Dominican Republic’s
power grid by reducing energy losses and increasing revenue collections.
Addressing the challenge of climate change is a strategic priority for
IFC. Since 2005, IFC has invested $18.3 billion of its own funds and mobilized
an additional $11 billion from other investors to finance climate-smart
projects across the globe. This includes investments in the Dominican energy
sector related to the distribution of liquefied natural gas, and the construction
of wind farms and power lines.
Since the Dominican Republic became a member of IFC in 1961, IFC has invested
more than $1 billion in the country’s private sector. IFC currently has
a $384 million portfolio in the Dominican Republic, including $172 million
mobilized by partner institutions.
About the IFC-Canada Climate Change Program
The IFC-Canada Climate Change Program promotes private sector financing
for clean energy projects and received funding under Canada’s fast-start
financing to catalyze investments in renewable, low-carbon technologies
that would not otherwise happen. The Government of Canada is committed
to support climate change action and will deliver $2.65 billion between
2015 and 2020 to support developing countries’ transition to low carbon
economies and adapt to the impacts of climate change. For more information,
IFC, a sister organization of the World Bank and a member of the World
Bank Group, is the largest global development institution focused on the
private sector in emerging markets. Working with more than 2,000 businesses
worldwide, we use our capital, expertise, and influence to create markets
and opportunities in the toughest areas of the world. In FY17, we delivered
a record $19.3 billion in long-term financing for developing countries,
leveraging the power of the private sector to help end poverty and boost
shared prosperity. For more information, visit www.ifc.org
About Akuo Energy
Entrepreneur by Nature Akuo Energy is the leading French independent renewable
energy power producer. Akuo Energy is present across the whole value chain,
including project development, financing, construction, and operation.
As of end-2016, Akuo Energy had invested 2 billion USD for a total capacity
of 960 MW in operation and under construction. Its headquarters are located
in Paris, France while it has subsidiaries in 13 other countries: Uruguay,
Croatia, Poland, Turkey, Indonesia, UAE, Luxembourg, Australia, Mongolia,
Bulgaria, Mali, Dominican Republic and the United States. Akuo Energy aims
to have a global production capacity of 3,500 MW in 2022. For more information
please visit www.akuoenergy.com