The project consists in the construction, operation and maintenance of two photovoltaic (PV) power plants (Albireo 1 and 2) with a combined installed capacity of 140 MWp (100MWac), including an 8.7-kilometer transmission line and other interconnection facilities, located in the municipalities of Puerto del Triunfo, Jiquilisco and Ozatlán, in the Department of Usulután, El Salvador (the “Project”).
The Project will benefit from 20-year US$ denominated PPAs at a price of around US$49.6MWh signed with the seven distribution companies. The PV plant will have an energy storage system based on a guaranteed 3 MW/1.5 MWh Battery Energy Storage System in order to comply with the El Salvador grid code of a 3% primary reserve service for primary regulation.
The Project is being developed by Neoen S.A.S. (the “Sponsor”) a French independent power producer. The estimated total cost of the Project is around US$144 million. It is anticipated that the financing will be structured through three Senior Loans from IDB Invest, FMO and Proparco of around US$30 million each. The rest of the financing will be funded with equity from the Sponsor.
The Project will provide significant and tangible benefits to El Salvador as (i) it will significantly increase the share of solar energy within El Salvador’s generation matrix; (ii) based on the auction price, the Project will contribute to reduce the electricity bills as the current PPA price is significantly below the current market average; and (iii) by investing 3% of the Project’s revenue in local social development programs, the Project will support local communities.