Financing renewable energy: Sanchuan Energy
Societe Generale successfully closed an RMB 280 million 5-year senior secured structured club loan for a subsidiary of Sanchuan Energy Group, in conjunction with other banks. The deal will finance a 48MW hydro plant in Yunnan province, China. A strategic step that puts Societe Generale at the forefront of the growing renewable energy market in Asia Pacific.
Sanchuan Energy is one of the top privately owned enterprises in China's small sector hydropower industry and operates 26 hydropower plants totalling 248MW. The group operates under strict environmental and social monitoring and requirements, imposed by two of its landmark equity owners, the International Finance Corporation and the Asian Development Bank.
"This loan contributes to a better energy mix for the country, to the supply of reliable energy to boost the Yunnan province's economic development and to the income growth of local residents,'' says Daniel Mallo, Head of Natural Resources & Energy Project Finance & Metals and Mining Finance, Asia Pacific.
The Sanchuan deal in China is not Societe Generale's first in the renewable energy sector in Asia Pacific. "Last year, for example, we closed a very successful financing deal in Australia," explains Daniel Mallo. "The Hornsdale wind farm in Jamestown will provide approximately 20% of the power needs of the Australian Capital Territory, bringing it closer to its target of having 90% of its electricity supplied by renewable resources by 2020. It's also a project with a positive social impact, as it will not only contribute to the further development of renewable energy in Australia, but also create new job opportunities there."
In 2014, Societe Generale closed the financing of the world's largest greenfield geothermal power plant, Sarulla, as well as the Asahan 1 hydroelectric power plant project, both in Indonesia.