Norsk Solar, an independent solar power producer, has secured a green bond of $10 million to finance its 18 MW solar power project in Brazil.
The funding was secured through the issue of a 15-year Certificado de Recebiveis Imobiliarios (CRI) green bond with support from the Brazilian asset manager Valora Investimentos.
The green bond will provide over 50,000,000 BRL (~$10 million) in financing in the form of non-recourse project debt. Construction on six sites included in the project is underway.
The project, set to be completed in 2024, will provide clean energy to over 50,000 homes in the region and generate recurring revenue for 25 years under the terms of the power purchase agreement (PPA) with corporate off-taker Órigo Energia.
The project will offset approximately 257,400 tonnes of CO2 emissions equivalent over the systems’ lifetimes.
“Norsk Solar is proud to help Brazil reach its decarbonization goals by increasing access to solar power. The green bond is an innovative mechanism for climate investment, and a useful part of our project financing toolkit, providing attractive leverage, extended tenor, and lower interest costs, improving future cash distributions,” said Øyvind L. Vesterdal, CEO of Norsk Solar.
“The innovative financing tools offered by the CRI structure will allow a strong and efficient development of our pipeline in the Geração Distribuída GD (distributed generation). This transaction confirms the firm interest of Brazilians and international investors in the local solar market,” said Mauro Benedetti, Country Manager Norsk Solar – Brazil.
The project has successfully received an equity investment from Norsk Solar and its project partners, Norfund and Finnfund, via the platform company Nordic Impact Cooperation.
According to Mercom Annual and Q4 2022 Solar Funding and M&A report, large-scale project funding in 2022 came to $32.1 billion in 179 project funding deals, to $18.7 billion in 185 projects in 2021.