A 16.1 MW wind project in the Shandong province of China has won a $10.2 million loan from German development bank Deutsche Investitions und Entwicklungsgesellschaft (DEG). German firm InfraVest is developing the project of 12 Nordex 1.3 MW turbines and two Nordex 250 kW machines. The plant will be two-thirds owned by German turbine builder Nordex with communally owned Quingdao Dongyi Industrial Corporation holding the remaining third. The two partners will provide 40% of the required $17 million capital, with the DEG loan covering the remaining 60%. DEG usually contributes loans of no more than 30% of the borrowed capital, but the bank's Amischir Biley says: "This project is an exception because we have been so closely involved." The plant has a ten year power purchase contract negotiated with the local electricity company at a fixed price of about CNY76/kWh (EUR 0.09-0.1/kWh). Biley says Chinese authorities consider a 10-15% return on investment to be sufficient -- and fix the price accordingly. The bank's aim is to demonstrate "that a commercially financed and operated project is possible in China." Site wind speeds are 6.5 m/s at 40 metres. China, with 400 MW of wind stations, is aiming for 1500 MW installed capacity in 2005. The China project is the third commercial wind financing project carried out by DEG. It has previously provided commercial loans for a 15 MW project in Brazil and a 10.2 MW project in Turkey. It has also given guarantee backing for wind project feasibility studies that are underway in Ghana and Peru. The bank finances private sector companies' investment in developing countries.
Have you registered with us yet?
Register now to enjoy more articles and free email bulletins.