Washington, D.C. / Mexico City,
May 28, 2013-- IFC, a member of the World Bank Group, provided $25
million in local currency ($315 million pesos), and has led the structuring
of $50 million ($630 million pesos) loan from Mexican development bank,
Nacional Financiera, (Nafin) to support the construction of the landmark
30-megawatt Aura Solar I project, the country’s first large-scale and
first private solar power plant in Mexico. It is estimated that the
solar potential in Mexico could reach 2,000 megawatts by 2020.
Aura Solar I has been developed by Mexican
power developer Gauss Energia and is owned and controlled by the Mexican
investment group Corporacion Aura Solar. The solar plant is located
in the State of Baja California Sur and will deliver energy to the “Olas
Altas” substation managed by the Federal Electricity Commission (CFE),
Mexico’s federal integrated power utility. This project is also
Mexico’s first power project of any generation source to be developed
and project-financed under the Mexican “small producer” (pequeno productor)
regulatory model.
The small producer model grants private
power plants with a net installed capacity of up to 30 megawatts the ability
to secure transmission interconnection rights with CFE, and to deliver
all the generated power to CFE under a 20-year off-take agreement. Energy
plants under the small producer model have variable prices and do not benefit
from a power purchase agreement with a pricing floor, which makes this
type of project subject to price volatility (similar to merchant power
projects).
“Aura Solar I is the first plant of
a larger initiative that aims to become a platform to develop more key
photovoltaic solar plants in Mexico under the small production and self-supply
regimes. We are thrilled to have worked with IFC and Nafin in this project,
and look forward to strengthening these relationships in future projects,"
said Hector Olea, President and CEO of Gauss.
“Mexico has tremendous irradiation
and solar power potential. IFC’s financing of Aura Solar I demonstrates
that utility-scale solar power is viable in Mexico and that project financing
can be structured around the merchant pricing component of the “small
producer” model,” said Bernard Sheahan, IFC Director for Infrastructure
and Natural Resources, Latin America and the Caribbean and Sub-Saharan
Africa. “IFC, with its global expertise in renewable energy projects,
is committed to help unlock Mexico’s solar potential and to partner with
other financing institutions such as Nafin to support the Government of
Mexico in achieving its climate change goals.”
“With Aura Solar I, Nafin had the opportunity
to finance the first large-scale private solar project in Mexico with an
innovative financial structure and together with IFC which is one of the
most prestigious international financial institutions”, said Enrique Nieto,
Nafin’s Head of Financing for Sustainable Projects. “This project
will pave the way for many other projects in the solar field, and for other
renewable energies in Mexico. It is also part of Nafin’s commitment to
support the financing of private-sponsored renewable energy projects which
today reaches up to 1,000 megawatts in the country”.
The Aura Solar I project economics are
competitive on market terms and do not require government subsidies. The
new solar plant will reduce the price of energy for CFE by replacing older,
heavily polluting diesel plants. It is expected to generate approximately
82,000 gigawatt hours of energy per year – equivalent to the consumption
of approximately 164,000 people – and will offset more than 60,000 tons
of CO2 each year, making an important contribution to the reduction of
greenhouse gas emissions.
Financing Aura Solar I is part of IFC’s
strategy to promote expansion of renewable energy in Mexico. IFC
has supported the long-term project finance of the first two Mexican self-supply
private sector wind power projects: the 250 megawatt Eurus plant and the
67.5 megawatt La Mata-La Ventosa plant which have contributed to scaling-up
private sector participation in Mexico’s wind energy sector.
To-date, IFC has financed 21 solar projects
in four continents with an installed capacity of more than 431 megawatts
for a total financing of $710 million, and 23 wind energy projects with
an installed capacity of more than 1,862 megawatts for a total financing
of $1.2 billion.
About IFC
IFC, a member of the World Bank Group,
is the largest global development institution focused exclusively on the
private sector. We help developing countries achieve sustainable growth
by financing investment, mobilizing capital in international financial
markets, and providing advisory services to businesses and governments.
In FY12, our investments reached an all-time high of more than $20 billion,
leveraging the power of the private sector to create jobs, spark innovation,
and tackle the world’s most pressing development challenges. For more
information, visit www.ifc.org
About Nafin
Nacional Financiera (Nafin), the Development
Bank of Mexico, has provided financing to small and medium private enterprises
for almost 80 years. Nafin’s growth strategy of the past few years has
allowed it to finance a greater number of companies and to support the
development and financing of strategic and sustainable projects with high
economic and social impact for the country. For more information, visit
www.nafinsa.com
About Gauss Energía:
Gauss is a leading business development
firm specialized in Mexico’s energy sector. The activities of Gauss focus
in the identification, development and marketing of investment opportunities
in the power sector. In particular, Gauss Energía has extensive experience
in the development of renewable energies that has enabled the company to
successfully participate in the structuring of more than 350 MW in renewable
projects. For more information, visit www.gauss.com.mx
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