Japan-headed developer and operator of renewable power plants RENOVA, Inc, has announced that it has reached financial close and made a final investment decision regarding the Omaezakikou Biomass Energy GK as the operator of the 74.9 MWe Omaezakikou Biomass Power Generation Project in Omaezaki and Makinohara, Shizuoka Prefecture, Japan.
RENOVA operates its power generation business based on locally available renewable energy resources such as solar, biomass, wind, and geothermal energy. In biomass, the company is “accumulating its knowledge and experience” through the development and operation of the 20.5 MWe Akita Biomass Project that it joined in 2015 as well as the 75 MWe Kanda Biomass Project which began construction during 2018, and the 74.8 MWe Tokushima Tsuda Biomass Project, construction of which is also underway.
RENOVA has reached financial close on the 74.9 MWe Omaezakikou Biomass Project and will work on the development together with three co-sponsors – Chubu Electric Power Co., Inc (34 percent share), Mitsubishi Electric Credit Corporation (18 percent share), and Suzuyo Shoji Co., Ltd (10 percent share) – to increase the corporate value of the Omaezakikou Biomass Power Project.
RENOVA holds the right to additionally acquire 18.0 percent equity in the special purpose company owned by co-sponsor Mitsubishi Electric Credit Corporation, on or after the date of completion of the Omaezakikou Biomass Power Plant, in accordance with the Memorandum of Understanding (MoU) between RENOVA and Mitsubishi Electric Credit Corporation.
In the event of exercising this right, RENOVA’s ownership interest will be 56.0 percent, and the share of dividends distributed from the project to RENOVA will be 75.0 percent.
Using wood pellets and palm kernel shells (PKS) as fuel, the plant will generate electricity for the grid under the JPY 24 per kWh feed-in tariff (FIT) rate. Plant design work will start during November 2019 and construction is scheduled to begin during April 2021 with operations estimated to begin in March 2023.
The financial close led to the formation of a project finance syndicate with Sumitomo Mitsui Trust Bank Ltd and Shinsei Bank Ltd as lead managers and Mitsubishi UFJ Lease & Finance Co Ltd as the mezzanine lender.
