Solarpack closes financing package for Peru solar PV plant

The financing has been signed with lenders Crédit Agricole Corporate and Investment Bank, Natixis Corporate & Investment Baking, BBVA, and BNP Paribas, using a project finance structure, being the first renewable project financed in Peru based on a power purchase agreement (PPA) between private parties. In addition, the loan has been qualified as a green financing under Solarpack's Green Financing Framework that is in accordance with the Green Loan Principles, established by the Loan Market Association, which identify initiatives that promote environmental sustainability.

The San Martin solar plant, with a total installed capacity of almost 300 MW, is currently under construction and is expected to generate more than 819 GWh/y, equivalent to the annual electricity consumption of more than 440 000 homes. In addition, it will prevent the emission of more than 564 000 tpy of carbon dioxide. It is the largest solar plant in Peru's history.

“The closing of this financing once again demonstrates the great confidence that major international financial institutions have in Solarpack's solvency, business model, and management,” said Luis Alvargonzalez, the company's Chief Financial Officer.

In July 2023, Solarpack signed a PPA with Kallpa Generación, a leading generation and transmission company in the Peruvian power market that produces 23.44% of the country’s electricity, to support Kallpa’s own decarbonisation goals. This financing, therefore, enables the project execution to proceed in the further decarbonisation of Peru’s power sector and deliver on Kallpa’s commitments to its own customers.

With this project, Solarpack reaffirms its commitment to the development of renewable solutions for its customers in the countries in which it operates, furthering its growth and impact across Latin America.

In addition to the senior financing package, San Martín has also closed with BBVA, a revolving credit facility for up to US$19 million to fund working capital requirements during the construction of the project.

The following institutions advised on the transaction, on the side of the lenders:

• Milbank: Legal Advisor – New York.
• Garrigues: Legal Advisor – Peru.
• Mott MacDonald: Technical Advisor and Environmental and Social Advisor.
• Willis Towers Watson: Insurance advisor.
• Grupo Mercados Energéticos Consultores: Market Advisor.
• EY: Model Auditor and Tax Advisor.

The following institutions advised Solarpack:

• Clifford Chance: Legal Advisor – New York.
• Estudio Rodrigo Elias & Medrano: Legal Advisor – Peru.

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