GE Energy Financial Services and Virginia Solar Group subsidiary Pacifico Energy, a Japanese power plant development company, have partnered for a third time to construct a solar power project in Hosoe on Kyushu Island, Japan.
GE Energy Financial Services and Virginia Solar Group will jointly invest equity in a 96.2-megawatt (DC) photovoltaic solar plant, with GE Energy Financial Services’ commitment totaling ¥7.5 billion ($62M).
A ¥35 billion term loan facility with a 22-year tenor – led by The Bank of Tokyo Mitsubishi UFJ as the sole and exclusive mandated lead arranger – was provided on a non–recourse project finance basis with a syndicate of 12 Japanese financial institutions. Additional transaction details have not been disclosed.
GE Energy Financial Services has made equity and debt investment commitments of $1.9 billion in nearly two gigawatts of solar power projects worldwide, and plans to continue to invest over $1 billion annually in renewable energy projects.
Hosoe is the fourth Japan solar project in which GE Energy Financial Services has invested since last May. Last year, the company invested in Pacifico Energy’s Kumenan and Mimasaka Musashi solar projects in May and December respectively, and in September, the GE unit helped finance Japan’s largest solar project, which is being built in Setouchi City.
Hosoe Solar Project
Construction of the plant is underway in Hosoe on Kyushu Island, in the prefecture of Miyazaki.
Pacifico Energy is the project developer managing construction and operations of Hosoe, which is being built on 140 hectares of land that was originally intended for a golf course.
Once complete, it will be the largest solar power plant on Kyushu Island and consist of approximately 300,000 photovoltaic modules supplied by Trina Solar.
In addition to capital, GE is supplying the project with 50 units of 1.26-megawatt Brilliance Solar Inverters, which eliminate the need for an intermediate transformer, resulting in higher conversion efficiency and superior grid performance.
Hosoe is expected to begin commercial operations in the spring of 2018 and will sell its power to Kyushu Electric Power Company under a 20-year power purchase agreement. It is expected to generate enough clean energy to power up to 30,000 households and avoid 68,200 tons of CO2 emissions per year.
Japan’s renewables goal
By 2020, Japan aims to have 20 percent of its energy generated from renewable power sources, a goal which is supported by the country’s regulatory policies and feed-in tariff. Sushil Verma, a managing director and head of Asia Pacific at GE Energy Financial Services, notes that Hosoe is the third transaction between GE Energy Financial Services and Pacifico Energy that contributes to the country’s renewable energy goals.
Kazuomi Kaneto, president of Pacifico Energy K.K. added:
“We are excited about partnering again with GE on Japan’s third largest solar power plant, and the largest in the country which is invested 100 percent by foreign financial institutions. This investment, leveraging the extensive development experience of our team, helps Japan achieve 20 percent of its power generated from renewable sources.”