It has acquired 50% of the Santa Isabel photovoltaic project from SunPower for US$200 million.
Through its acquisition of a stake in the Santa Isabel project - a photovoltaic solar plant with a capacity of 190 MW - France’s Total Eren, a subsidiary of the Total group, has formalized its entry into the Chilean market.
It acquired its 50% stake from SunPower for US$200 million. Construction of the plant has just begun and it is scheduled to start operation in the last quarter of 2020.
According to Total Eren’s vice-president of business development for the region, Martin Rocher, the company sees important potential for the development of renewable projects in Chile and views this as a long-term business opportunity.
It is, in fact, already working on an expansion of the Santa Isabel project, which may even start construction in 2020, depending on the signing of energy sales contracts on which negotiations are reportedly at an advanced stage.
“We believe that financing conditions in Chile remain very good and we will be seeking to close this issue shortly, raising additional debt, in order to build the expansion of Santa Isabel. Both stages represent 800 GWh per year of additional energy. It is clean, reliable energy that we can offer clients within a defined time because phase one can start in 2020 and the next one in 2021,” says Rocher.
He explains that, despite recent events in the country, the fundamentals for investing in Chile have not changed and, although the company recognizes an impact in the short and medium term, it remains interested in the development and operation of projects.
The company’s aim is to continue growing inorganically. “In Chile, there are projects in the market that already have a certain level of development; there is a portfolio of solar and wind initiatives. The best thing for us is to enter projects that have a degree of development, but to close [the investment] and intervene early enough to optimize the design,” says Rocher.
The company also aims to compete for a number of energy contracts with non-regulated clients that will come up for renewal in 2021 and 2022. In addition, it is eyeing the greater need for energy that will arise as a result of the exit of coal-fired power plants.
“The pie, as well as growing, will also change in nature so there are two cumulative effects, which can hasten our investment. That is why we wanted to be present and enter as soon as possible,” concludes Rocher.
To find out more about investment opportunities in Chile’s energy sector, see this article.
Source: El Mercurio and Total Media