Scatec , a leading renewable energy solutions provider, has signed a 15-year Power Purchase Agreement (PPA) with BTG Pactual Comercializadora de Energía, a Colombian energy trading subsidiary of Banco BTG Pactual S.A. Brazil (BTG). The PPA will cover approx. 85% of the estimated production from a 130 MW solar plant, with the remaining production to be sold in the Colombian electricity market. The PPA will be denominated in Colombian Pesos and inflation adjusted based on Colombia’s Producer Price Index.
With this award, Scatec will advance its first project in Colombia. The project will be located in Nariño, just over 100 kms west of Bogotá. Colombia has attractive market fundamentals, offering high irradiation, strong demand for renewables and a supportive regulatory environment. Colombia is expected to add more than 5 GW of solar capacity over the next five years.
'This agreement marks an important step for Scatec as we enter the Colombian market with a commercially robust project. Colombia offers a solid framework for renewable energy investments, and we are pleased to contribute to the country’s energy transition through our integrated business model,' says Scatec CEO Terje Pilskog.
The estimated total capital expenditure (capex) for the solar plant is USD 110 million, and Scatec will be the designated Engineering, Procurement and Construction (EPC) provider with an EPC scope of approximately 80% of capex. Scatec will further provide Operations & Maintenance (O&M) and Asset Management (AM) services for the plant.
The project will be financed by non-recourse financing and equity, with Scatec retaining majority ownership and Norfund joining as minority equity partner. Scatec is in advanced negotiations with selected financial institutions for non-recourse project financing, with a targeted leverage of 65%. Financial close and construction start is expected in 2025.
Source: Scatec
