Aquila Clean Energy Raises Financing For 2.6 GW of Renewable Energy Projects in Southern Europe With the Support of Investeu – EQ Mag Pro

• Financing of unprecedented EUR 1 billion built-to-sell construction facility including one of the biggest loans ever granted by the European Investment Bank (EIB) under a Project Finance structure

• EIB loan backed by the EU’s new InvestEU programme

• Further loans from seven commercial banks

• Project volume of more than EUR 2 billion in total for renewable energy pipeline in Spain and Portugal with over 50 projects

Hamburg  : Aquila Clean Energy EMEA, Aquila Capital’s clean energy development platform in Europe, has finalised a EUR 1 billion construction facility supported by the InvestEU programme. The financing will support the development and construction of Aquila Clean Energy’s renewable energy pipeline in Spain and Portugal over the next three years. The projects will be implemented in regions like Castilla y León, Comunidad Valenciana, Andalucía, Cantabria, Castilla-La Mancha and Murcia, in Spain, and Setúbal, Coimbra, Evora, Leiria, in Portugal.

The pipeline consists of more than 50 projects of predominately solar photovoltaics (PV) and onshore wind assets, with a total electricity generation capacity of 2.6 gigawatts (GW), a volume equivalent to the annual consumption of around 1.4 million households. These projects will have an estimated yield of 5.3 terawatt hours per year.

The operation is aligned with the EU’s renewable energy targets and supports Spain and Portugal in meeting their commitments to reduce greenhouse gas emissions. In addition, the vast majority of investments are expected to be located in the EIB’s cohesion priority regions (91% according to the project pipeline), thus supporting the economic recovery in these regions which were particularly affected by the COVID-19 pandemic.

For the construction facility, Santander acted as the Facility and Security Agent. NatWest acted as Documentation Agent and KfW IPEX-Bank as Hedging Documentation Agent. BNP Paribas, ING, Intesa SanPaolo and Banco Sabadell further supported the facility. The debt was significantly oversubscribed, confirming lenders’ strong interest in the financing.

CMS and White & Case (both Hamburg) acted as borrowers’ and lenders’ legal counsel, respectively. Glas SAS in Frankfurt is acting as Administration Agent.

For the EIB, this short-term construction financing is breaking new ground, as the development bank had mainly acted as a long-term lender in the infrastructure space in the past. This project was made possible because of an EU budget guarantee under the InvestEU programme, which allows the EIB to increase its risk taking capacity and, in this particular case, to assume electricity merchant risk under a non-recourse financing structure as the transaction does not involve any price hedge mechanism such as a PPA.

The InvestEU programme follows up on the success of the Investment Plan for Europe and aims to facilitate investments in the EU. The landmark transaction announced today not only increases renewable energy generation capacity on the Iberian Peninsula significantly, but also contributes to the objectives of the European Green Deal.

A bespoke EUR 1 billion construction facility consists of EUR 400 million credit from the EIB – supported by an EU budget guarantee under InvestEU – and EUR 600 million from the consortium of the commercial banks. For the total project volume of over EUR 2 billion, the remaining amount of more than EUR 1 billion comes from funds managed by Aquila Capital and from the company’s capital.

Susanne Wermter,CEO of Aquila Clean Energy EMEA, emphasises: “We are extremely pleased about being able to secure this landmark financing in a market environment which is marked by high inflation, rising interest rates, supply chain issues and the war in the Ukraine. This transaction constitutes the largest financing in the history of Aquila Clean Energy and Aquila Capital. It demonstrates the creditability and appeal of our clean energy assets that aim to actively shape the European energy transition. With the financing now secured, we are opening up additional growth for our company and, with the planned assets, we will be able to offer our investors further interesting opportunities. I would like to thank all parties involved for their dedication and effort over the past twelve months to make this deal work.”

Ricardo Mourinho Félix,EIB Vice-President, highlights: “This construction facility is the first of its kind and a landmark transaction for the EIB. As the EU climate bank, we put sustainable development at the heart of our activities. We are therefore extremely proud to be financing this project, through a Green Loan that contributes substantively to Europe’s energy transition and the security of energy supply.”

Valdis Dombrovskis, Executive Vice-President for an Economy that Works for People, said: “Developing the infrastructure that will secure the objectives of the European Green Deal will require significant financial support. InvestEU will play an important role in mobilising the financing. I am delighted that this programme is facilitating a EUR 2 billion investment that will help Spain and Portugal fulfil their green energy potential.”

About Aquila Clean Energy

Aquila Clean Energy EMEA is Aquila Capital´s clean energy platform in Europe. Aquila Clean Energy develops, realises and operates clean energy assets in the technologies of solar, wind, hydropower and battery storage. Currently, Aquila Clean Energy manages a portfolio with a total capacity of more than 8.2GW.

With a local approach and through local teams of experts, Aquila Clean Energy initiates, develops, realises and operates what it identifies as essential assets along the entire value chain and over the lifetimes of the assets. Aquila Clean Energy has built a permanent presence in seven countries with 140 employees, believing that local, on-site management teams are key to the company’s operations.

Aquila Clean Energy is part of Aquila Capital, an investment and asset development company focused on generating and managing essential assets on behalf of its clients. Currently, Aquila Capital manages assets worth nearly 14 billion euros on behalf of institutional investors worldwide. The company has been carbon neutral since 2006 and aims to act carbon negative.

About the European Investment Bank

The European Investment Bank (EIB) is the long-term lending institution of the European Union owned by its Member States. It provides long-term financing for sound investments that contribute to EU policy. The Bank finances projects in four priority areas: infrastructure, innovation, climate and the environment, and small and medium-sized enterprises (SMEs). The EIB recently adopted its Climate Bank Roadmap to deliver on its ambitious agenda to support €1 trillion of climate action and environmental sustainability investments in the decade to 2030 and to allocate more than 50% of its financing to climate action and environmental sustainability by 2025. As part of the roadmap, all new EIB Group operations have been aligned with the goals and principles of the Paris Agreement since 2021.

About the InvestEU Programme

The InvestEUProgramme provides the EU with crucial long-term funding by leveraging substantial private and public funds in support of a sustainable recovery. It also helps mobilise private investments for the EU’s policy priorities, such as the European Green Deal and the digital transition. The InvestEU Programme brings together under one roof the multitude of EU financial instruments currently available to support investment in the EU, making funding for investment projects in Europe simpler, more efficient and more flexible. The programme consists of three components: the InvestEU Fund, the InvestEU Advisory Hub and the InvestEU Portal. The InvestEU Fund is implemented through financial partners that will invest in projects using the EU budget guarantee of €26.2 billion. The entire budget guarantee will back the investment projects of the implementing partners, increase their risk-bearing capacity and thus mobilise at least €372 billion in additional investment.

Source: aquila-capital