MADRID, Spain, Aug. 1, 2012 (Press Release) -
Ence has closed a Project Finance for a total of €60.7 million to finance its new Mérida biomass power plant, an operation which has been coordinated by Banesto as the agent bank, and in which La Caixa and BBVA also take part. This is the second operation of this type performed in Spain for the financing of a biomass plant, after the operation performed last year, also by Ence, for its Huelva plant, which will start operation this year.
Ence had also singed the EPC contract with Sener, which guarantees project execution as regards costs, quality and the timeframe. The total plant investment amounts to €80.9 million.
Ignacio Colmenares, Ence CEO, said "the project will enable one of the largest renewable biomass power plant in Spain to start operation in the third quarter of 2014 in Mérida, with a nominal power of 20 MW, and will provide a recurring EBITDA of €10 million/year, with an estimated production up to 160 million kWh/year, that is enough to meet the electricity needs of around 150,000 people".
The main features of this operation, which highlights the high level of trust which the finance community has placed in Ence's biomass renewable energy project, are the following:
75% of the project shall be financed through debt and 25% through shareholders' equity.
The financing period is 15 years, 2 for the construction period and a 13-year amortisation period over the plant's commercial operation.
Ence, a leader in biomass energy generation
The financing obtained for the Mérida plant constitutes a significant milestone in the development of Ence's growth strategy in the energy sector, which envisages the operation of another additional 210 MW in biomass plants until 2015, more than double the current power installed. It should be noted that this September is scheduled synchronization of 50MW biomass plant in Huelva that will provide a recurring EBITDA of 25 million € / year
The company has a biomass renewable power of 180 MW, which makes it the Spanish leader in biomass energy generation, with an electricity production of more than 1,500 million kWh per year.
Ence is promoting the international development of biomass electricity generation, an aim for which a highly qualified professional team has been established. This line of activity makes it possible to showcase in the next few years the high international potential created by Ence in the energy sector, thanks to development of a technology platform for the cultivation of energy crops and biomass generation, technologies in which the company is a global leader.
In parallel, Ence continues to advance in projects which were temporarily impacted by the moratorium on renewable energies, making them ready to start building with the greatest possible agility, once the suspension is lifted. The company contemplates the possibility of continuing to invest and grow in the energy sector with the firm intention of having a stable, recurring EBITDA of €100 million coming exclusively from this business line before the end of 2015.
Benefits of Biomass Energy
Renewable energy from biomass has enormous growth potential in Spain, second country in the European Union in wooded areas. In fact, it is the only renewable energy that has a positive economic balance of the benefits given its capacity for employment generation (up to 20 jobs per MW installed), rural development and contribution to improving the environment, both through the capture of CO2 care and clearing of hills and mountains, with a reduced risk of fire of up to 70%.
In addition, it is the only one that can be managed, independent of variable factors such as sunlight, wind or the availability of agricultural waste. Besides, biomass could take part in the progressive replacement of Spanish coal creating jobs in the affected mining regions, given the proximity of those areas to forest areas with the potential for biomass production.