AES Geo Energy, a majority-owned subsidiary of big American utility AES, recently secured financing for the 156 MW St Nikolas wind project it is currently building near Kavarna on Bulgaria's Black Sea coast. AES Geo Energy owns 89% of the project. Despite the challenging financial climate, out of a total project cost of EUR 270 million the company raised EUR 198 million, nearly 75%, from non-recourse financing. This was backed by a consortium of lenders, led by the European Bank for Reconstruction and Development, the World Bank's International Finance Corporation and Milan-based UniCredit Markets & Investment Banking for a 15-year term. AES, with its deep pockets, put down EUR 68 million and covered the remaining EUR 4 million of required equity at financial close. AES Geo Energy, co-owned by Bulgarian-German company Geo Power, will construct and operate the plant of 52 Vestas 3 MW turbines. It will be the country's biggest wind plant by far when fully operational at the end of the year. The output will be sold to the National Electric Company under a 12-year power purchase agreement. It will be AES's fifth plant up and running in Europe. AES has more than 1 GW of operational wind capacity worldwide and aims to triple its investment in the sector by the end of 2010 (Windpower Monthly, December 2008). Bulgaria is "the kind of country in which AES looks to do business," the company says. Another critical factor is that AES can leverage off an existing presence in Bulgaria. The company is building a $1.4 billion 670 MW lignite-fired thermal plant in Bulgaria, making it the largest foreign investor in the power sector.
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