IFC funds new wind power plant in Jordan

Amman, The International Finance Corporation (IFC), a member of the World Bank Group, is providing $71 million to fund the construction of the new Daehan Wind Power Plant in Jordan. It is IFC’s second major investment in the country’s wind energy this year.

According to a statement by the IFC, the 51-megawatt plant will be built in the southern governorate of Tafila to provide clean energy to homes and businesses across the Kingdom.

During the last two decades, the World Bank Group has played a key role in Jordan’s energy sector, aiding its unbundling and subsequent privatization through regulatory and financial support.

IFC has also facilitated the country’s renewable energy program with financing and investment solutions. So far, IFC has invested over $300 million in 13 renewable projects, enabling well over $1 billion in private sector investments in Jordan’s power sector.

This latest investment is part of IFC’s broader effort to help Jordan boost its domestic energy supply through renewable power, following pioneering investments in the Tafila wind farm and the Abour wind farm and others.

IFC is also leading industry efforts to reduce the risks that wind farms pose to wildlife, including birds, through a “landscape approach” to risk management.

The corporation engages different stakeholders, including multiple private operators of wind projects in the area, to assess potential negative impacts on biodiversity on a region-wide basis and agree on coordinated measures to mitigate them.

The $103 million Daehan project is being developed by two Korean sponsors, KOSPO and Daelim Energy, the statement added. IFC is providing a $10 million loan for its own account and also acted as lead arranger, mobilizing parallel loans of $26 million from Managed Co-Lending Portfolio Program (MCPP), $27.7 million from the Standard Chartered Bank, and $8 million from Korea’s Shinhan Bank.

IFC also structured an equity bridge loan of $26 million, its first in project financing, and will provide interest rate swaps for half the financing package.

“IFC’s ability to innovate and its vast experience in Jordan’s renewable sector has helped us enter this new market,” said Taehee Cho, General Manager of Daehan Wind Power Company, set up by KOSPO and Daelim Energy. “This project will help scale up further renewable energy generation and contribute to Jordan’s objective of diversifying its domestic energy supply, while bringing down overall costs.”

Daehan Wind is the first engagement in Jordan’s renewable sector by KOSPO, Daelim Energy, and Shinhan Bank.

“We are helping to bring vital foreign direct investment into Jordan from new sources and mobilizing capital on a long-term basis,” said Mouayed Makhlouf, IFC Director for the Middle East and North Africa. “IFC’s countercyclical investment approach is helping to enhance the competitiveness of Jordan’s renewable sector and setting a model for similar investments in the region.”

Source: Jordan News Agency