Equinor hits FID on Brazilian solar
Norwegian energy company Equinor has made a final investment decision on a solar project the company is developing in Brazil.
Equinor is building the Mendubim project, a 531MW solar asset located in the state of Rio Grande do Norte. The project started construction earlier this year and is set to be fully operational by 2024.
The energy company is partnering with Scatec and Hydro Rein on the project with each party owning 33.3% of the project. The trio will jointly provide EPC services while O&M and asset management services will fall on Scatec and Equinor.
The project requires around $430 million to be financed through a combination of project financing and equity from each partner. Earlier this year, the sponsors requested a $195 million loan for the project from IDB Invest (PFR, 4/4).
The Mendubim project contracted a 20-year power purchase agreement for about 60% of its output with Alunorte, an alumina manufacturer and subsidiary of Hydro Rein’s parent company.
The remaining portion of output will be sold in the free market through Hydro Energia and Equinor’s subsidiary Danske Commodities.
“With the Mendubim project, we expand our investments in renewables in Brazil considerably, and take an important step towards building a material solar portfolio in the country. From 2024 onwards, Mendubim will annually produce around 1.2TWh of power, which is equivalent to electricity consumption of 620,000 Brazilian households,” said Olav Kolbeinstveit, senior vice president for power and markets within Renewables at Equinor.
In Brazil, Equinor operates the Apodi solar project, a 162MW solar asset developed jointly with Scatec and brought online in 2018 (PFR, 10/4/17).