Inter-American Investment Corporation (IIC) has signed an agreement to invest in common stock of up to USD3.5 million in Union Group subsidiary Andean Power Generation SAC.
The proceeds will be used in the construction of El Carmen and 8 de Agosto hydropower plants in the Huánuco region in central Peru, which will generate a combined 27.4 MW of capacity and are backed by two 20-year power purchase agreements with the Peruvian Government. They are due to start operating during Q1 2016.
These plants will add a total of 204 GWh of clean energy per year to the Peruvian power system, which is equivalent to the annual supply of energy for more than 150,000 people.
The two projects are in total worth USD88 million and they mark the first stage of Union Group’s plan to build nine hydropower plants with 125 MW of capacity in the Huanuco region in central Peru. Across the country, Union Group is developing a hydropower portfolio of close to 1,000 MW of combined capacity.
Juan Sartori, President and Founder of Union Group, says: “We welcome IIC as an important strategic partner in the development of our hydropower projects in in Peru. IIC’s support will help ensure the delivery of these two important plants, the provision of clean energy for 150,000 people and jobs for 400 people in the local area.”
The IIC, which is a member of the Inter-American Development Bank (IDB) Group, promotes private-sector development in Latin America and the Caribbean with a focus on small and medium-sized enterprises (SMEs). The IDB is the largest source of development financing for Latin America and the Caribbean.