IFC and NADB provide US$200 Million loan to IEnova to fund four solar power plants in Mexico

The International Finance Corporation (IFC), a member of the World Bank Group, and the North American Development Bank (NADB) announced it will provide US$200 million in green loans to Infraestructura Energética Nova S.A.B. de C.V. (IEnova), to finance four solar power plants with a total capacity of 376 MW across Mexico.

The financing is part of IFC’s efforts to work with leading private-sector firms in Mexico to promote climate change mitigation projects, including the development of non-conventional renewable energy. IFC is providing a US$100 million loan from its own account and, initially, mobilizing another US$100 million from NADB. The NADB loan will be oriented completely to the design, construction and operation of IEnova’s 125 MW solar park, “Don Diego”, located in the municipality of Benjamin Hill, Sonora.

IEnova’s power plants will reduce emissions by 561,652 tons/year of carbon-dioxide equivalent, thus supporting the Government of Mexico’s efforts to cut greenhouse-gas emissions and helping to diversify the country’s energy supply.

IEnova is one of the largest private sector energy companies in Mexico, with operations in natural gas, power generation and refined products storage segments. The projects being financed are the company’s first in the solar energy space.

This is IFC’s first financing in Mexico certified under the Green Loan Principles, which provide a framework and guidelines to confirm that the proceeds of the loan are used for climate-friendly projects.

Tania Ortiz, CEO of IEnova said:

“We are very pleased to receive the first loan certified under the Green Loan Principles that IFC grants to a company in Mexico. Once again, IEnova is at the forefront and stands out as a leader, not only because of its innovation and financial discipline, but also for its high standards in terms of sustainability.”

Tania Ortiz also said:

“With this important strategic alliance with IFC and NADB, we reiterate, in the hands of two of the most important development banks, our confidence in Mexico and our commitment to continue investing in energy infrastructure projects that promote the development and well-being of our country”.

Georgina Baker, IFC’s Vice President for Latin America and the Caribbean said:

“This investment, in addition to other recent IFC-financed solar power generation projects, is part of our long-standing support to foster the development of a sophisticated and competitive power market in Mexico. The private sector needs to play a leading role in Mexico’s efforts to mitigate climate change and with these projects, IEnova is helping further the country’s climate agenda.”

NADB Managing Director Calixto Mateos-Hanel stated:

“With this project, Sonora is becoming one of the top producers of solar energy in Mexico and thus helping the Mexican government reach its renewable energy goal. We have worked with IEnova on other renewable projects and are confident this project will also be a success.”

IFC has been one of the largest financiers of the power sector in emerging markets, committing $6.7 billion (including mobilization) as of FY 2018 to support power sector-related investments.

IFC has shifted its focus to contribute to the transformation of the energy mix by investing in assets that displace carbon-intensive thermal assets with renewable energy assets.

As of FY 2018, IFC’s power sector commitments were 55 percent in renewable energy and energy efficiency, 31 percent in thermal generation, and 14 percent in distribution and transmission projects.

Source: Press Release by IFC.