Project detail - ALSAFAWI FOR GREEN ENERGY PRIVATE S

Who is our customer

FMO’s intended client is Alsafawi for Green Energy PSC, a special purpose vehicle incorporated in Jordan to develop, construct and maintain a solar power plant in the Mafraq region of northern Jordan. The Borrower will be 70% owned by Abdul Latif Jameel Group (ALJ), through its holding of Fotowatio Renewable Ventures (FRV), and 30% owned by Arabia Trading & Consulting Company LTD (ATC). ALJ is one of the region's largest diversified firms with operations in engineering, finance and energy and environmental services. FRV is a leading developer and operator of renewable energy assets with a 4.8 GW development portfolio. Since 2006, FRV has completed the financing and construction of over 780 MW of solar energy plants. ATC is a diversified Jordanian firm and performs consulting, contracting and renewable energy development. It has a strong local presence in solar PV engineering, procurement, construction and operation with more than 75 MW of solar projects under development.

What is our funding objective?

FMO intends to provide a USD 35.0mln senior loan to Alsafawi for Green Energy PSC, financed by FMO-A (USD 30mln) and IDF (USD 5mln). The objective of FMO’s financing is to fund the development and construction of a 66.6MWp (51.0MWac) solar PV plant in northern Jordan.

Why do we fund this investment?

Once operational, this power plant will generate approximately 143GWh annually, serving approximately 60,403 customers based on a per capita consumption of 2,357 kWh. The project serves to meet the growing demand for electricity in Jordan. By generating electricity from a renewable energy source, this solar plant is expected to avoid the emission of approximately 91.5 kilotons of CO2eq per annum. The project contributes to a diversification of Jordan’s fuel mix and provides for energy security by generating electricity from a domestic resource. It contributes to reducing the marginal cost of electricity in the country by generating electricity at a tariff close to half the long-term cost of generation in Jordan.

What is the Environmental and Social categorization rationale?

FMO’s environmental and social (“E&S”) due diligence indicates that the investment will have impacts which must be managed in a manner consistent with the following Performance Standards: PS1: Assessment and Management of Environmental and Social Risks and Impacts PS2: Labor and Working Conditions PS3: Resource Efficiency and Pollution Prevention PS4: Community Health, Safety and Security PS6: Biodiversity Conservation and Sustainable Management of Living Natural Resources The E&S Category is B+. This reflects that the potential adverse E&S impacts will be largely reversible and can be mitigated through readily available mitigation measures that will be included in the environmental and social management system (“ESMS”) to be used during construction and operation. The ESMS will, apart from standard environmental and social management measures, also include a Community Integration Plan and a Labour and Working Conditions Plan, to address key issues such as: employment and training for local residents, minimising conflict over local resources that may already be stressed due to the presence of refugees, building and maintaining good relationships with local communities, including Syrian refugees and semi-nomadic herders. IFC PS 5 is not triggered as land was acquired from private parties through a willing buyer-willing seller process. Semi nomadic herders who occasionally use the land for gazing have access to and already use the abundant land of similar or better quality around the site. IFC PS7 is not triggered as the semi-nomadic people who sometimes frequent the Project site are semi-permanent and well-integrated members of local villages. The IFC and EBRD describe IPs as people with social and cultural groups distinct from dominant groups within national society and people who self-identify as members of a distinct indigenous ethnic or cultural groups who often have a collective attachment to geographically distinct habitats, traditional lands or ancestral territories IFC PS8 is not triggered as no archaeological or cultural heritage artefacts were found to be impacted by any project component.

More investments

Date	Total FMO financing
9/8/2017	USD 4.68 MLN