IFC, OPIC, Canada Provide $62.7 Million for Jamaica's Largest Private Sector Wind Farm
Monday, January 26, 2015
Kingston, Jamaica – IFC, a member of the World Bank Group, with the support of the Government of Canada and along with the Overseas Private Investment Corporation (OPIC, the U.S. Government’s development finance institution) will help BMR Jamaica Wind Ltd. build, operate and maintain a 36.3 MW capacity wind farm about 90 km west of Kingston. This will be the largest renewable energy project developed by the private sector in Jamaica.
“The private sector, with support from long-term lending partners like OPIC, IFC and the government of Canada, is keen to develop Jamaica’s renewable energy potential,” said Bruce Levy, BMR’s Director. “With this initiative we plan to bring cleaner, cost competitive energy to the Jamaican electricity sector.”
The US$62.7 million financing package consists of a $42.7 million senior loan from OPIC, a US$10 million senior loan from IFC’s own account, and a US$10 million loan from the IFC-Canada Climate Change Program, which promotes private sector financing for clean energy projects and will help make the financing package viable.
Jamaica’s dependence on outdated oil-fired electricity generation has led to high electricity prices, which create a burden on the economy. This project is in line with Jamaica’s National Energy Policy, which has set a goal of diversifying the country’s energy matrix.
“Our aim is to reduce the reliance on imported oil and support cleaner, more efficient energy production,” said Jun Zhang, IFC Senior Manager for the Caribbean. “With this project, we hope to demonstrate the viability of the renewable energy sector and open the door to future renewable energy projects by the private sector.”
Caribbean islands generate most of their electricity from imported diesel or heavy fuel oil and devote a hefty portion of their GDP to fuel imports. At the same time, these islands are vulnerable to the environmental impacts associated with fossil-fuels, including air pollution, rising sea levels, and coral bleaching.
“Canada is proud to have made significant investments to support a range of projects to help countries adapt to climate change and increase renewable energy. We will continue to support environmental efforts such as these,” said the Honorable Leona Aglukkaq, Canada's Minister of the Environment, Minister of the Canadian Northern Economic Development Agency, and Minister of the Arctic Council.
“This wind power project’s impact for Jamaica and the Caribbean renewable energy sector is both promising and pioneering,” said Lynn Tabernacki, OPIC’s Managing Director for Renewable Energy and Sustainable Development. “On an island where importing oil can cost far more than the renewable alternatives, examples like this show that clean power both benefits the environment and can make sound financial sense.”
The wind farm will sell electricity to the private electrical utility, Jamaica Public Service Company, under a 20-year power purchase agreement. The project is expected to become operational in the first half of 2016.
IFC, a member of the World Bank Group, is the largest global development institution focused exclusively on the private sector. Working with private enterprises in about 100 countries, we use our capital, expertise, and influence to help eliminate extreme poverty and boost shared prosperity. In FY14, we provided more than $22 billion in financing to improve lives in developing countries and tackle the most urgent challenges of development. For more information, visit www.ifc.org
About BMR Energy
BMR Energy, LLC was founded in 2013 as a venture between three experienced energy professionals and American Capital Ltd. BMR Energy is focused on acquiring, developing, investing in and managing power and energy related projects in the Caribbean, Latin America and Mexico. The BMR team brings more than 60 years of combined international energy infrastructure development and operational experience.
OPIC is the U.S. Government’s development finance institution. It mobilizes private capital to help solve critical development challenges and in doing so, advances U.S. foreign policy. Because OPIC works with the U.S. private sector, it helps U.S. businesses gain footholds in emerging markets, catalyzing revenues, jobs and growth opportunities both at home and abroad. OPIC achieves its mission by providing investors with financing, guarantees, political risk insurance, and support for private equity investment funds.
Established as an agency of the U.S. Government in 1971, OPIC operates on a self-sustaining basis at no net cost to American taxpayers. OPIC services are available for new and expanding business enterprises in more than 160 countries worldwide. To date, OPIC has supported more than $200 billion of investment in over 4,000 projects, supporting almost $77 billion in U.S. exports and more than 278,000 American jobs. For more information, visit www.opic.gov.
About the IFC-Canada Climate Change Program
The IFC-Canada Climate Change Program, established in 2011, is a partnership between the Government of Canada and IFC to promote private sector financing for clean energy projects, through the use of concessional funds to catalyze investments in renewable, low-carbon technologies that would not otherwise happen. Canada’s financing to IFC for this program is part of its overall fast-start financing contribution. Under the Copenhagen Accord, developed countries committed to provide fast-start financing of almost $30 billion for 2010–2012 to support climate-change mitigation and adaptation in developing countries. As part of Canada’s commitment to support climate change action in developing countries, Canada contributed $1.2 billion Canadian dollars in new and additional climate-change financing over three years (fiscals 2010–2013).