NOVVA Group, a Singapore-based clean energy infrastructure platform, has signed a definitive agreement to acquire a Colombian solar portfolio from ABO Energy, the German renewables developer announced June 22.

The portfolio comprises three advanced-stage solar projects with a combined installed capacity of 37.8 MWac, located in the Andean highlands of central Colombia. The projects have secured grid connection approvals and long-term land lease agreements; commercial operation is targeted for early 2028.

The NOVVA deal by ABO Energy showcases the Singaporean company’s expansion strategy. Stock photo by Solar Energy/solarpanal355 via Pixabay.

A ‘Milestone’ in Energy Expansion

NOVVA describes the acquisition as a milestone in its Latin American expansion, citing Colombia’s accelerating demand for clean power driven by digital transformation and industrial modernization. The government’s 2024–2031 National AI Roadmap targets AI adoption across 50% of enterprises and public-sector institutions, the company said.

“Colombia is exactly the kind of market Novva is built to serve. By combining specialized financing with global delivery expertise, we are accelerating the local energy transition and laying the green power foundation that tomorrow’s digital economy and high-growth industries will rely on,” said Steven Liu, Founder and CEO of NOVVA Group.

Ingo Burdack-Debes, General Manager at ABO Energy, said the transaction advances high-quality assets with a partner capable of executing on financing and construction. “Their financing and execution capabilities make them an ideal partner to take the projects forward, driving local growth and accelerating Colombia’s clean energy transition,” he said.

NOVVA Expands Into Multiple Markets

The Colombian deal follows NOVVA’s recent acquisition of a 120 MWp solar project in the Philippines, expanding its footprint across emerging markets in Southeast Asia and Latin America. NOVVA Group Pte. Ltd. originates, finances, builds, and operates clean energy assets across both regions.

ABO Energy is headquartered in Wiesbaden, Germany, and develops wind, solar, storage, and hydrogen projects globally, managing the full project lifecycle from site assessment through long-term operations.

Headline image stock photo by Sebastian Ganso via Pixabay.

The Financiera de Desarrollo Nacional (FDN), a member of the Grupo Bicentenario, has announced its participation in the financial closing of the El Campano Solar Park. Located in Chinu, Cordoba, the renewable energy project is designed to strengthen national energy security and support the transition toward cleaner power sources.

The initiative involves the development, construction, and operation of a photovoltaic solar plant with an installed capacity of 128.8 MWdc (99.9 MWac). The facility is scheduled to begin commercial operations by the third quarter of 2027.

The financial structure includes a commitment from the FDN of up to $157.5 billion COP, consisting of senior debt and a bank guarantee. This contribution represents approximately 50% of the total project debt. The total investment for the project is estimated at $453.9 billion COP, utilizing a framework that combines private equity and long-term debt.

“The financial closing of the El Campano Solar Park represents a firm step in the consolidation of a cleaner, more resilient, and sustainable energy matrix for Colombia.” — Rafael Herz, acting president of the FDN

“The financial closing of the El Campano Solar Park represents a firm step in the consolidation of a cleaner, more resilient, and sustainable energy matrix for Colombia,” stated Rafael Herz, acting president of the FDN. “At FDN, we remain committed to mobilizing investment toward strategic projects that not only strengthen the country’s infrastructure but also generate positive environmental and social impacts in the regions.”

Revenue for the El Campano Solar Park is supported by a 15-year energy purchase agreement (PPA) with ISAGEN, a company maintaining a AAA credit rating. The contract operates under a “pay-as-generated” modality. Furthermore, the project is set to receive income via the Cargo por Confiabilidad (Reliability Charge) over a 20-year period, a mechanism intended to ensure long-term financial stability and debt service capacity.

The project is being developed by Atlas Renewable Energy in partnership with ISAGEN (BVC: ISAGEN). This collaboration is part of a broader joint strategy aiming to develop up to 1,000 MW of solar projects in Colombia by 2030.

In addition to its contribution to the Sistema Interconectado Nacional (National Interconnected System), the project is expected to reduce carbon dioxide emissions by approximately 4 million tons over its operational lifespan. This alignment follows national objectives regarding sustainability and climate change mitigation.

According to the FDN, the project integrates environmental, social, and governance (ESG) criteria into the financing decision-making process, focusing on the decarbonization of the economy and regional development.

The Norwegian renewable energy company Scatec ASA (OSE: SCATC) has reached financial close and initiated construction on the Barzalosa solar power plant in Colombia. The project, located in the municipio of Nariño within the department of Cundinamarca, has a planned capacity of 130 MWp. Total capital expenditure for the facility is estimated at $121 million USD.

The financing structure for the project is based on a 70% leverage model, utilizing a combination of equity and non-recourse debt. Scatec holds a 65% equity stake in the venture, while Norfund, the Norwegian investment fund for developing countries, provides the remaining 35%. The senior debt was provided by Bancolombia S.A. (NYSE: CIB; BVC: BCOLOMBIA) and the Financiera de Desarrollo Nacional (FDN).

The Financiera de Desarrollo Nacional committed a total of 200,358 million COP to the project. This includes a senior debt facility of up to 164,458 million COP with a term of 18 years, representing approximately 50% of the total project debt. Additionally, the FDN provided a bank guarantee of up to 35,900 million COP to substitute reserve accounts for debt service and operation and maintenance costs. The FDN also acted as a co-structurer for the financial framework of the operation.

“The financing of the Barzalosa project reflects the capacity of the FDN to structure long-term financial solutions that make strategic energy transition projects in Colombia viable,” said Enrique Cadena, Vice President of Structured Finance at the FDN.

The law firm Holland & Knight served as legal counsel to the lenders, Bancolombia and FDN, in the COP 330 billion financing transaction. The legal team was led by partner María Juliana Saa, with support from partner Inés Elvira Vesga and associates Juan Sebastián Parra and Juan Felipe Alonso. Other legal and financial advisors involved in the transaction included Cuatrecasas, which advised the borrower; Brigard Urrutia, which advised FDN regarding the credit facility; and Astris Finance, which provided financial structuring advice.

Revenue for the plant will be supported by a 15-year Power Purchase Agreement (PPA) with BTG Pactual Comercializadora de Energía (BVMF: BPAC11). The agreement covers 85% of the estimated energy production and is denominated in Colombian pesos, with adjustments based on the Producer Price Index. The remaining 15% of production will be sold on the Colombian spot market. The project is also eligible for the Cargo por Confiabilidad (reliability charge) and may access resources from the Inter-American Development Bank and the Climate Investment Funds.

Construction includes the installation of the solar array and the development of a six-kilometer transmission line to connect the plant to the national grid. Scatec is acting as the lead developer and the designated Engineering, Procurement, and Construction (EPC) provider, covering approximately 70% of the capital expenditure. The company will also manage operations, maintenance, and asset management. The Barzalosa plant is expected to reach its commercial operation date in the first half of 2027.

This is what Crowe Colombia estimates in its study: “How possible is the energy transition in Latin America,” in which it analyzes the possible paths we could take, compared to other countries in the region, and the implication of the decisions taken by the national government in the coming months.

According to Janeth Romero (above photo), a Crowe audit partner, “by way of comparison, it is estimated that in the United States and Europe the energy transition would cost between 5% and 6% of GDP per year. Reducing CO₂ emissions costs money, since it must make a technological transformation for electricity generation, in the mobility of the transport system and support the conversion of sectors that generate large emissions such as agriculture and clothing, among others.”

Taking into account that in the first stage of this transition the great protagonist would be gas, the use and production of oil and coal would tend to be reduced significantly since tangible facts such as the manufacture and sale of electric cars, the race for solar and wind energy, would begin to discourage their consumption.

“This means that total demand for fossil fuels would have to decline steadily until 2050, by an annual average equivalent to the production of a large oil field. On the other hand, offshore oil operations in the exploration stages would become less and less viable and those that are underway would become riskier”, assures Romero.

According to analysis by the University of Texas, the decrease in the fall in demand, due to a hypothetical concerted transition policy at regional level, would affect all oil producers in the region and the impact would be felt more by those that are more dependent on crude oil, which are Venezuela, Ecuador and Colombia.

Historically, before the sharp decline registered in recent years by the state-owned oil company PDVSA and the subsequent sanctions imposed by the United States, around 95% of the foreign currency coming into Venezuela came from oil. Venezuelan crude oil sales in 2019 totaled US$12.2 billion, equivalent to 83% of the country’s exports, according to data from the Observatory of Economic Complexity.

Taking a look at Brazil, this is a country that has become “the great oil producer in Latin America”, with almost three million barrels per day, a figure similar to that reached by Venezuela and Mexico “in their good times”, but despite the size of the sector, Brazil is not dependent on oil, as it produces agro-industrial products on a large scale that position it as a natural exporter.

In the case of Argentina, unconventional crude oil deposits have recently been discovered (known as shale oil) that have great potential, and it is worth noting that this country, together with Chile and Bolivia, is known as the “lithium triangle”, where the world’s largest reserves of this mineral, key for the production of electric batteries and vital for the energy transition, are found.

Now, it is important to analyze that the current context allows us to foresee that, at least in the next three decades, the consumption of fossil fuels will continue to increase, then the countries of the region will be able to continue producing and making the business profitable and thus, obtain sustainable resources to guarantee the adequate energy transition.

However, to ensure an adequate process and the sustainability of the industry, the countries most dependent on oil and its derivatives must focus efforts on efficiency and reducing production costs, and in turn, reduce the intensity of carbon and greenhouse gases.

“For Colombia, on the other hand, these resources continue to be absolutely necessary for the national economy and therefore it is advisable that while a serious strategy is being prepared with truly sustainable projections, it is still necessary for industry players and the government to mitigate the effect of the fall in production, as it will fall faster than demand and there is a risk of losing self-sufficiency, impacting state revenues and its announced social investment plans” concluded Romero.

Presenters hailed from Peru, Mexico, Argentina, Chile, Bolivia, Brazil, Ecuador, Dominican Republic, and the host country of Colombia. Sponsors included Teincomin, International SOS, Fichtner, and Imesa.

On the second day, Finance Colombia publisher Loren Moss presented a session titled “Innovative ways to attract investment in the renewables sector,” and moderated a later panel on “How to increase efficiency, profitability and avoid merchant risks.”

Vostock Capital is also organizing the first Hydrogen Latin America Congress and Exhibition from November 30 to December 1, 2021 to take place at the NH Collection WTC Royal hotel in Bogotá. Interested exhibitors or participants may contact Catalina Velasco, Latin America Marketing Manager: cvelasco@vostockcapital.com or click here to visit the event website.

MPC Energy Solutions was established by MPC Capital to capitalize on the growing demand for sustainable and cost-competitive low-carbon energy infrastructure by developing and operating renewable energy assets. The new company plans to develop and invest in renewable energy generation including utility-scale solar PV and wind farms, energy storage, co-generation as well as other infrastructure that helps reduce energy consumption and carbon emissions.

On the company website, it lists 5 projects under development in Colombia, plus one each in El Salvador and Jamaica, and says all projects will start construction in the second half of this year and begin energy production at the end of 2022.

“We have a strong team with a proven track record in renewable energies of more than ten years and made great strides towards becoming the leader in renewable energy infrastructure in the region of Latin America and The Caribbean. We look forward to further develop our renewable energy business as we continue to offer our investors the opportunity to capitalize on a strong growth sector with an ever-growing global demand for new projects,” said Ulf Holländer, CEO of MPC Capital.

Martin Vogt, CEO of MPC Energy Solutions, said: “The clean energy sector has matured materially in the past 10-15 years, but the environment is changing, and the simple deployment of solar PV and wind technology is often not sufficient anymore. The industry and our clients require solutions that provide around the clock low carbon, cost-competitive and reliable power supply. Therefore, it becomes critical to design projects that meet such demand utilizing different generation and storage technologies.”

“The company aims to implement projects with more than 500 MW of installed capacity of low carbon and renewable energy infrastructure over the next two years. Given our local presence and strong experience within the Caribbean and Latin America, we will build a first series of projects here before expanding into other parts of the world. In our core markets, the clean energy sector requires about $18 billion of investment in the coming decade. We aim to become the leading contributor to the energy transition in the region and beyond,” said Vogt.

“The successful initiation of MPC Energy Solutions underlines the ability of the MPC group to tap capital markets for attractive real asset investment strategies. In doing so, Oslo Stock Exchange was an obvious choice in our search for the most suitable marketplace. The impressive track record with renewable companies provides for an educated and professional domestic and international investor base for companies like MPC Energy Solutions,” he said.

The Private Placement was marketed by Fearnley Securities AS and SpareBank 1 Markets AS as Joint Lead Managers and Bookrunners, while Advokatfirmaet Wiersholm AS served as Norwegian legal counsel.

Image by Manuel de la Fuente from Pixabay