Yinson Renewables has made a significant leap in Peru’s energy landscape with its Matarani solar plant, which boasts one of the highest photovoltaic power potentials in the country. The recent securing of $59 million in senior secured green financing marks a pivotal moment, not just for Yinson, but for the entire renewable energy sector in Peru. This financing, arranged by IDB Invest and Natixis Corporate & Investment Banking, adheres to the Green Loan Principles 2023, a set of guidelines that ensure the sustainability of financing projects.
The Matarani project, with a peak capacity of 97 megawatts, is strategically located near Arequipa and is underpinned by a long-term power purchase agreement (PPA) with Orygen, a prominent player in the Peruvian renewable energy market. This arrangement is crucial, as it provides a stable revenue stream that enhances the project’s financial viability. What sets Matarani apart is that it is the first operational solar plant in Peru financed through a green project finance facility without relying on government subsidies. This is a groundbreaking achievement that could inspire similar projects across the region, showcasing that renewable energy can stand on its own two feet.
Amaury Chastan, director of infrastructure and energy finance at Natixis CIB, highlighted the transaction as a reinforcement of their leadership in financing renewable energy in Latin America. This confidence is well-placed; the Matarani plant is expected to deliver 260 gigawatt-hours (GWh) of renewable energy annually, enough to power around 62,000 households. The sheer scale of this project demonstrates the untapped potential of solar energy in Peru, a country that has historically relied heavily on thermal and hydroelectric power sources.
Yinson’s Chief Financial Officer, Vegard Urnes, expressed enthusiasm about this achievement, framing it as a milestone for the company in Latin America. The collaboration with IDB Invest and Natixis CIB not only emphasizes the importance of strategic partnerships but also reflects a shared commitment to sustainable development and climate action. The Matarani project is positioned to significantly contribute to Peru’s energy transition, aligning with the country’s goals to reduce dependence on conventional energy sources.
The acquisition of the project from Grenergy Renewables in January 2024 further underscores Yinson’s strategic approach to expanding its footprint in Latin America. Grenergy’s role in providing a full turnkey engineering, procurement, and construction contract, along with operation and maintenance services for the initial two years, ensures that the project is in capable hands.
IDB Invest’s CEO, James Scriven, echoed the sentiment of optimism surrounding the Matarani project, emphasizing its role in advancing Peru’s transition to renewable energy sources. As the world grapples with the pressing need for sustainable energy solutions, projects like Matarani serve as a beacon of possibility. They not only enhance environmental sustainability but also highlight the vast potential for non-conventional renewable energy in Peru.
The successful execution of this financing could very well set the stage for future developments in the sector. As more financial institutions recognize the viability of green loans, we might see an influx of similar projects, leading to a more diversified and resilient energy landscape in Latin America. The Matarani solar plant is not just a project; it’s a testament to the evolving dynamics of energy finance and a harbinger of a greener future.
