|Director of Infrastructure Finance Division of ADB’s Private Sector Operations Department Jackie B. Surtani (3rd L) and GED Executive Director Yupapin Wangviwat (4th L), along with officials from the Japan International Cooperation Agency, Bangkok Bank PCL, Siam Commercial Bank PCL, and Standard Chartered Bank (Thai) PCL, during the signing ceremony on January 22 – PHOTO: ADB
ADB’s assistance for the Gulf solar power project was provided through an innovative project finance structure, which ensured the bankability of the project. It will help catalyze commercial financing for one of the first large-scale solar power project finance transactions in the country.
The loan is composed of an US$11.3 million A loan and a B loan of up to US$18.9 million, according to the bank.
An additional US$7.6 million loan was provided by the 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 program and improves the bankability and financial viability of the project to allow other lenders to provide long tenor, U.S. dollar-denominated financing.
The B loan will be funded by Bangkok Bank PCL, Siam Commercial Bank PCL, and Standard Chartered Bank (Thai) PCL.
“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 Jackie B. Surtani, director of the Infrastructure Finance Division of ADB’s Private Sector Operations Department, in a statement.
He added that apart from providing much-needed financing to develop solar power in Vietnam, the project will also help reduce perceived risks in the Southeast Asian country’s renewable energy sector.
“We believe the project’s fundamentals were improved significantly as a result of its competitive financing structure and longer tenor led by ADB, and we are confident that the project will be developed successfully according to plan,” said Yupapin Wangviwat, executive director of Gulf Energy Development Public Co., Ltd. (GED).
The Vietnamese Government 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% by 2030 to meet rapidly growing energy needs and reduce greenhouse gas emissions by up to 25% by 2030.
The project will develop and operate the 50-MW solar power plant and its associated facilities in Tay Ninh Province, which is about 50 kilometers northwest of HCMC.
The solar power plant will directly serve the electricity demand of residents and businesses of the city and its surrounding areas. It will reduce annual carbon dioxide emissions by 29,760 tons by 2020.
Founded in 2017, TTC Energy is 90% owned by GED, a leading private power generation company which has the largest portfolio of gas-fired power projects in Thailand.
The Philippines-based ADB is committed to achieving a prosperous, inclusive, resilient, and sustainable Asia and the Pacific, while sustaining its efforts to eradicate extreme poverty. Established in 1966, it is owned by 68 members – 49 from the region.