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 Ishinomaki Hibarino Biomass Energy GK as the operator of the 74.9 MWe Ishinomaki Hibarino Biomass Power Generation Project located in Ishinomaki, Miyagi 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, the 74.8 MWe Tokushima Tsuda Biomass Project, and the 74.9 MWe Omaezakikou Biomass Project for which construction is underway.
RENOVA has reached financial close on the 74.9 MWe Ishinomaki Hibarino Biomass Project and will work on the development together with three co-sponsors – Tokyo Gas Co., Ltd (34 percent share), United Purpose Management, Inc (15 percent share), and Mizuho Leasing Co., Ltd (13 percent share) – to increase the corporate value of the Ishinomaki Hibarino Biomass Project.
RENOVA also holds the right to additionally acquire 13.0 percent equity in the special purpose company owned by co-sponsor Mizuho Leasing., on or after the date of completion of the Ishinomaki Hibarino Biomass Power Plant, in accordance with the Memorandum of Understanding (MoU) between RENOVA and Mizuho Leasing.
In the event of exercising this right, RENOVA’s ownership interest in the project will be 51.0 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 March 2020 and construction is scheduled to begin during November 2020 with operations estimated to begin in May 2023.
The financial close led to the formation of a project finance syndicate with Mizuho Bank Ltd and Sumitomo Mitsui Banking Corporation as lead managers and The Akita Bank Ltd, The Bank of Iwate Ltd, The Bank of Yokohama Ltd, The Iyo Bank Ltd, Kita-Nippon Bank Ltd, The Michinoku Bank Ltd, The San-In Godo Bank Ltd, The 77 Bank Ltd, The Toho Bank Ltd, The Tohoku Bank Ltd, The Yamaguchi Bank Ltd, Akita Shinkin Bank, Ugo Shinkin Bank, The Shoko Chukin Bank Ltd, Asahi Mutual Life Insurance Company, and JA Mitsui Leasing, Ltd as the mezzanine lender.
