Project detail - XLA Entoria Holdings L.P.

Who is our customer

Entoria Energy Latin America (“EELA” or “Entoria”) and FMO will co-invest in Solar Assets Latin America Pte (“SALA”). SALA is a vehicle that has been established to hold solar assets developed by EELA. EELA is an established as a pan Latin America & Caribbean (“LAC”) distributed solar energy developer, a subsidiary of Entoria Energy Group, a privately held global developer, investor and operator with a leading track record in distributed solar across Europe, Asia and LAC. EELA’s assets are predominantly located in Colombia, with the remainder of the exposure comprising of Ecuador, Panama and Mexico. The off-takers of the platform are creditworthy Commercial & Industrial (“C&I”) clients across the region under long-term Power Purchase Agreements (“PPAs”).

What is our funding objective?

The funding objective of this investment is to satisfy a near-term capital need to start construction (and continue development) of advanced solar projects in EELA’s pipeline. FMO provides equity funding for an investment up to USD 15mln. This investment supports small- and medium-sized enterprises ("SMEs") in greening their energy consumption.

Why do we fund this investment?

This opportunity fits well with FMO’s Private Equity Energy strategy of pursuing impactful, 100% Green-labelled investments within the energy transition and increasing LAC exposure, one of the core geographies within FMO’s investment mandate. The platform addresses the growing energy need in the region, while providing affordable and stable energy sources. Ultimately, the increase of distributed energy capacity plays a crucial role in reducing dependency on carbon-intense energy sources. This transaction contributes to local job creation and provision of clean & affordable energy.

What is the Environmental and Social categorization rationale?

The potential adverse environmental and social (E&S) impacts of SALA's activities may be moderate to significant if unmitigated, but not unprecedented and largely reversible and manageable with standard mitigation measures. Therefore, the E&S risk of this investment opportunity is categorized as B+. As SALA will realize rooftop and ground-mount captive solar photovoltaic ("PV") installations at the sites of C&I off-takers, the risks to be mitigated may vary by site but will not involve risks related to land acquisition and land-use change. Therefore, the IFC Performance Standards (PSs) triggered are typically PS 1 to 3, and occasionally 4. PS 5 to 8 will normally not be triggered by the projects realized by SALA. The main E&S risks to be managed and mitigated relate to working conditions and health & safety (both electrical safety and working at heights), and the contractor supervision that comes with this. The company has an environmental and social management system, amended and approved as part of this investment opportunity. Dedicated E&S capacity in the company is established in this light as well.