Making a commitment to renewable energy
The world’s largest ‘greenfield’ geothermal power plant, Sarulla will develop a capacity of 330 megawatts and contribute to greener growth in Indonesia by taking advantage of the country's substantial geothermal resources (40% of world potential). Societe Generale took part in the US$1.17 billion financing package for the construction of the plant and acted as the mandated lead arranger and as the “technical bank”, responsible for coordinating with the technical consultants and for the due diligence on the project. The bank played a key role in structuring the deal and also provided hedging services.
Over the past 15 years, Societe Generale has gained extensive experience in financing renewable energy projects, notably geothermal, in the Asia-Pacific Region. The project meets the Positive Impact Financing criteria that Societe Generale is determined to promote: it combines a positive impact and the generation of clean and renewable energy with the appropriate management of any potentially negative effects. Measures aimed at reducing the project’s impact on neighbouring communities and complying with the most stringent environmental and social requirements (such as the Equator Principles) have been included at the design, construction and operational stages. In addition, this transaction won the Best Project Financing Award at the 2014 Global Capital Asia/Asiamoney Awards.
Given the importance of this project for Indonesia, it was essential for us to work alongside a sound partner like Societe Generale, which understood the project from a technical standpoint and had the financial experience to secure the capital required.
Jumpei Sakaue, Head of Project Financing for Sarulla Operations, the entity that will build, own, and operate the power plant