The Asian Development Bank (ADB) and Phu Yen TTP Joint Stock Company (Phu Yen JSC) on October 9 signed a US$186 million loan to develop and operate a 257 megawatt (MW) solar power plant in the southern province of Phu Yen’s Hoa Hoi, through the country’s first certified green loan.
Phu Yen JSC is owned by B.Grimm Power Public Company Limited and Truong Thanh Vietnam Group Joint Stock Company (TTVN).
The financing comprises a US$27.9 million loan funded by ADB, a US$148.8 million syndicated loan (B loan) funded by commercial banks with ADB as lender of record, and a US$9.3 million loan from Leading Asia’s Private Infrastructure Fund (LEAP).
The syndicated loan is the first green B loan in Asia and the Pacific to be certified by the Climate Bonds Initiative, and one of the largest B loans mobilised in Vietnam.
Participating commercial banks include Bangkok Bank, Kasikorn Bank, Kiatnakin Bank, Industrial and Commercial Bank of China, and Standard Chartered Bank. Green loans are used to fund new or existing projects that deliver environmental or climate-related benefits.
Infrastructure Finance Division Director for East Asia, Southeast Asia, and the Pacific at ADB's Private Sector Operations Department Jackie B. Surtani said ADB is committed to supporting B.Grimm, one of the bank’s most valued clients, with its long-term expansion into Vietnam and its important work in renewable energy.
“We’re also excited to work for the first time with TTVN. This project will support the rapid development of solar power capacity in Vietnam, advance the country’s low-carbon growth goals, and, we hope, catalyse further commercial bank financing for renewable energy,” Surtani said.
The project is the largest single operating solar power plant in Vietnam and one of the largest in Southeast Asia. It will help to reduce 123,000 tonnes of carbon dioxide annually. The power plant will deliver electricity to Quang Ngai and Nha Trang cities, as well as surrounding areas in a region that is emerging as one of Vietnam’s key tourist centres.
B.Grimm Power President Preeyanart Soontornwata said this transaction will support the development of clean and sustainable energy in Vietnam and help promote the green loan market in Southeast Asia.
“This project is a further demonstration of B.Grimm Power adopting international best practices, and this landmark green transaction is proof of our focus on doing business sustainably. We would like to express our sincere appreciation to ADB for their leadership role in the transaction, and to our B loan lenders whose invaluable support builds on our long-standing relationships forged over multiple transactions,” Preeyanart Soontornwata said.
TTVN Chairman Dang Trung Kien said TTVN had successfully worked with B.Grimm from day one to reach commercial operation within a short period, thereby contributing to the energy security goals of Vietnam.
“We are pleased to see the project operating very well and value the partnership and support from ADB and participating commercial lenders in achieving this financing milestone in the Vietnamese renewables market,” he said.