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|The ADB loan deal will provide about $30 million to the Golf Solar Power Project|
The Asian Development Bank's (ADB) assistance for the Gulf Solar Power Project was provided through an innovative project financing structure which ensured the bankability of the project. It will help catalyse commercial financing for one of the first large-scale solar power project financing transactions in the country. The loan is composed of an $11.3 million A loan and a B loan of up to $18.9 million.
“ADB is excited about this transaction because the project will have a significant impact on the sustainability and security of Vietnam’s energy sector for years to come,” said the director of Infrastructure Finance Division of ADB’s Private Sector Operations Department, Jackie B. Surtani. “Apart from providing much-needed financing to develop solar power in Vietnam, the project will also help reduce perceived risks in the country’s renewable energy sector.”
An additional $7.6 million loan was provided by Leading Asia’s Private Infrastructure Fund, which is supported by the Japan International Cooperation Agency. The loan marks the first transaction under the fund’s Non-Parallel programme and improves the bankability and financial viability of the project to allow other lenders to provide long tenor, US dollar-denominated financing. The B loan will be funded by Bangkok Bank PCL, Siam Commercial Bank PCL, and Standard Chartered Bank (Thai) PCL.
The government of Vietnam plans to increase the share of renewable energy sources such as hydropower, solar, wind, and biomass as a percentage of total installed capacity to 21 per cent by 2030 to meet rapidly growing energy needs and reduce greenhouse gas emissions by up to 25 per cent by 2030.
The project will develop and operate the 50MW solar power plant and its associated facilities in Tay Ninh province, which is about 50 kilometres northwest of Ho Chi Minh City. The solar power plant will directly serve the electricity demand of residents and businesses of Ho Chi Minh City and surrounding areas. It will reduce annual carbon dioxide emissions by 29,760 tonnes by 2020.
“We believe the project’s fundamentals were improved significantly as a result of its competitive financing structure and longer tenor led by the ADB and we are confident that the project will be developed successfully according to plan,” said Gulf Energy Development Public Company Limited (GED) executive director, Yupapin Wangviwat.
Established in 2017, TTC Energy is 90 per cent owned by GED. GED is a leading private power generation company and has the largest portfolio of gas-fired power projects in Thailand.