Revised project documents issued, reversal on arbitration rules
The International Finance Corporation (IFC), part of the Washington-based World Bank Group, is preparing to finance six solar photovoltaic (PV) projects under Egypts feed-in tariff scheme.
Most of the projects have a capacity of 50MW and have been allocated a site at Benban site near Aswan.
The IFCs total lending for the six projects is $110m. It hopes to mobilise a further $370m from other sources.
|Company||Size||Location||EPC contractor||Cost ($m)||IFC loan ($m)||B-loan/parallel loans ($m)|
|Gestamp Solar FiT (AlTawakol Electrical Company (GILA; local), X-ELIO Energy (Spain) and Spectrum International for Renewable Energy; Jordan)||50MW||Benban SBN1-1||Elecnor (Spain), Consolidated Contractors Company (CCC; Athens-based)||128||20||76|
|Taqa Arabia Solar (Qalaa Holdings; local)||50MW||Benban (SBN21-3)||Sterling & Wilson (India)||115||20||67|
|Taqa Arabia (Qalaa Holdings; 50%) & Solar Reserve (US; 50%)||50MW||Zafarana (PV-4)||Sterling & Wilson||115||20||67|
|Cairo Solar Farm (Globeleq; UK; 49%, local investors)||50MW||Benban (SBN20-3)||Sterling & Wilson, Shapoorji Pallonji (India)||108||20||61|
|Delta Solar (Nile Capital; local; 35%, Canadian Solar; 40%, Ideemasun Energy (Germany; 25%)||50MW||Benban (19-3)||Enneray (Italy)||120||20||70|
|Gestamp solar 2 (AlTawakol Electrical Company (GILA), X-ELIO Energy, Spectrum International for Renewable Energy)||20MW||Benban (SBN42-4)||Elecnor, CCC||54||10||30|
The debt to equity ratio for the projects is expected to be around 75:25.
The entire feed-in tariff programme has a maximum capacity of 4300MW, which implies an investment of $8bn. For the 2000MW, or more than 40 utility scale solar PV projects, development banks including the IFC, the European Bank for Reconstruction & Development (EBRD) and the African Development Bank (AfDB) plan to extend up to $2bn of finance.
Mohamed Salah el-Sokbi, executive chairman of the New & Renewable Energy Association (NREA), told local press that 87 investors eligible to go ahead with feed-in tariff projects.
However, the deadline for financial close, in late October, is looking increasingly tight. Projects which do not reach a financial close by then are expected to be moved onto a less generous tariff.
Revised project documents have been released. Clauses allowing international arbitration, which were previously negotiated and agreed, have been removed.
This is likely to delay the signing of power purchase agreements (PPAs) further, as developers and lenders protest the change.
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