Peruvian power producer Electro Zaña SAC has secured US dollar financing from privately owned Banco Internacional del Peru (Interbank) towards the development of the 13.2 MW Zaña run-of-river hydropower plant in the Department of Cajamarca, as well as an associated 50 km-long transmission line.
Interbank provided two facilities: a 15-year term loan for US$ 14 million and a VAT financing facility of US$ 10 million, the tenor of which is related to the construction period. The transaction comprises a typical series of guarantees to protect Interbank, including cash flow and asset trusts, share pledges and mortgage over the concession as well as a commitment by the shareholders of the concessionaire to cover any deficit, cost overruns or contingency during the construction phase.
The project, which is to be built in the Upper Zaña river basin, will use water discharged from the existing Buenos Aires hydropower plant. The plant, which will be equipped with two 6.6 MW horizontal-axis Francis turbines and associated 7.5 MVa generators, is designed to generate average annual output of 81.76 GWh from a design flow of 3.25 m3/s.
Interbank has experience in financing hydropower projects, having disbursed over the past five years loans to 11 mini hydropower plants (up to 20 MW) with long-term PPAs signed with the Ministry of Energy and Mines, following successful bids in renewable energy auctions. Seven of the eleven projects are now in operation, representing 23 per of total renewable energy projects nationwide.
