IDB Invest, Neoen Improve the Stability & Security of El Salvador’s Power Grid
This project will support the largest battery group in Central America.
IDB Invest, a member of the IDB Group, has granted two long-term loans to the Capella Solar and Providencia Solar projects operated by Neoen, one of the most dynamic renewable energy producers in the world. The resources will be used to finance two new energy storage batteries for the aforementioned projects and to refinance the existing battery installed in Capella.
The deals will improve the stability and safety of the Salvadoran electricity grid, adding 11 MW / 8 MWh in two energy storage batteries providing regulated primary and secondary reserve services at the Capella Solar (140 MWp) and Providencia Solar (101 MWp) projects, located in the departments of Usulután and La Paz, respectively. With these new additions, Neoen's batteries in El Salvador will reach a total power of 14 MW and a storage capacity of 10 MWh, making it the largest group of energy storage batteries in Central America.
Financing for these teams will be granted by IDB Invest with blended financing resources from the Canadian Climate Fund for the Private Sector of the Americas - Phase II (C2F2). This transaction presents a flexible repayment scheme linked to the savings in operating costs of both solar plants, generated by the use of energy storage batteries as technology for the provision of regulated primary and secondary back-up services. Through this project, IDB Invest and C2F2 will be providing their largest financing to date for energy storage batteries in Latin America and the Caribbean.
The energy storage projects are already in the works and should be up and running by the second half of 2022. Thanks to their response capabilities in milliseconds, the batteries will improve the quality of the primary and secondary back-up service that provides stability and security for the electrical network. It is estimated that the batteries will reduce CO2 emissions by 5,000 metric tons per year, as they displace the service of plants that operate on fossil fuels to cover the primary and secondary back-up requirements of the Salvadoran electricity grid.
This operation potentially contributes to two United Nations Sustainable Development Goals (SDGs): Affordable and Clean Energy (SDG 7), Industry, Innovation and Infrastructure (SDG 9).
About IDB Invest
IDB Invest, a member of the IDB Group, is a multilateral development bank committed to promoting the economic development of its member countries in Latin America and the Caribbean through the private sector. IDB Invest finances sustainable companies and projects to achieve financial results and maximize economic, social, and environmental development in the region. With a portfolio of $13.1 billion in asset management and 385 clients in 25 countries, IDB Invest provides innovative financial solutions and advisory services that meet the needs of its clients in a variety of industries.
About the Canadian Climate Fund for the Private Sector of the Americas - Phase II
The purpose of the Canadian Climate Fund is to catalyze greater private investment to climate change mitigation and adaptation projects in Latin America and the Caribbean, offering concessional financing to projects that do not benefit from a sovereign guarantee, paying special attention to the poorest and most vulnerable countries. The main areas of investment are generation technologies with renewable energy and storage, energy efficiency, sustainable transport and projects to reduce greenhouse gases, including reforestation, sustainable agriculture and improvement of land use, as well as supporting adaptation to vulnerability to climate change. The resources have a transversal investment mandate to promote gender equality.
Neoen is one of the world's most dynamic independent renewable energy producers (IPP). With a capacity of more than 4.1 GW in operation or under construction, Neoen is a high-growth company. Neoen is notably active in Argentina, Australia, El Salvador, Finland, France, Ireland, Jamaica, Mexico, Mozambique Portugal, and Zambia. In particular, Neoen operates the largest photovoltaic solar plant in France (300 MWp in Cestas, France), and the world's largest lithium-ion energy storage battery in Hornsdale, Australia (150 MW / 193.5 MWh). Neoen aims to reach a capacity of 10 GW in operation or under construction by the year 2025. (ISIN code: FR0011675362, ticker: NEOEN) The company has been listed on the stock exchange since October 2018, in Compartment A of the Euronext Paris regulated market. For more information: www.neoen.com