Al Safawi Solar PV Project

Country:

Jordan

Project number:

49072

Business sector:

Power and energy

Notice type:

Private

Environmental category:

B

Target board date:

18 Jul 2017

Status:

Signed

PSD disclosed:

15 Jun 2017

Translated version of this PSD: Arabic

Project Description

A senior secured A/B loan of up to USD 70 million to finance the construction of an up to 51 MW solar photovoltaic plant located in Safawi Area, 150 km east of Amman, Jordan. The Project will support the country's goals of increasing renewable energy capacity, reducing reliance on costly hydrocarbon imports and meeting rapidly growing electricity demand.

Project Objectives

As part of the government's second round of direct proposals for solar (Round 2), the Project represents an important part of its ambitious programme to generate 10% of Jordan's electricity demand from renewables by 2020 and reduce greenhouse gas emissions to 14% below business-as-usual levels by 2030.

Transition Impact

The Project will contribute towards Jordan's transition to a low carbon economy by increasing the installed capacity of renewable energy.

Client Information

FOTOWATIO RENEWABLE VENTURES BV

The Borrower will be a special purpose vehicle, Al-Safawi for Green Energy PSC, incorporated in Jordan for the sole purpose of developing, constructing and operating the Project. The Borrower will be 70% owned by Abdul Latif Jameel Group (ALJ), through its holding of Fotowatio Renewable Ventures (FRV), and 30% owned by Arabia Trading & Consulting Company LTD (ATC).

ALJ is one of the region's largest diversified firms with operations in engineering, finance and energy and environmental services. FRV is a leading developer and operator of renewable energy assets with a 4.8 GW development portfolio. Since 2006, FRV has completed the financing and construction of over 780 MW of solar energy plants.

ATC is a diversified Jordanian firm and performs consulting, contracting and renewable energy development. It has a strong local presence in solar PV engineering, procurement, construction and operation with more than 75 MW of solar projects under development.

EBRD Finance Summary

USD 35,000,000.00

Up to USD 70 million senior secured loan split equally between an EBRD A-loan and a Nederlandse Financierings-Maatschappij voor Ontwikkelingslanden N.V. (FMO) B-loan.

Total Project Cost

USD 93,300,000.00

Environmental and Social Summary

Non-technical summary | SEP | Non-technical summary and SEPT in Arabic

Category B (ESP 2014). The 50MW solar PV plant is located within Mafraq governorate in the north of Jordan ca. 100 km east of Amman, within the Badiya Al-Shamaliyeh District with the closest Al-Safawi village located 13 km to the northeast of the Project site. The total Project area is ca. 170ha site, characterized as being barren desert habitat of the eastern deserts of Jordan covered with basalt stones. The archaeological authorities confirmed that the plant does not impact any designated cultural heritage monuments areas. The nearest protected site (Important Bird Area) is ca. 40km. The Project is categorised as B as its construction and operation activities are associated with site-specific E&S impacts that can be mitigated, and the site examination by the Bank's environmental expert and independent consultants confirmed that there are no E&S sensitive areas affected by the Project. The Project has been subject to a Jordanian Environmental and Social Impact Assessment ("ESIA") with public consultations, and an environmental permit was issued by the Competent Authorities.

The Project's Environmental and Social Due Diligence ("ESDD") was carried out by an independent consultant under the terms of reference prepared by the Bank. The ESDD focused on reviewing the Client's E&S institutional capacity and management systems to ensure Project's compliance with EBRD Performance Requirements ("PR"), analysis of specific environmental issues such as dust emissions, water use and wastewater management, removal of basalt stones waste and biodiversity implications, raw materials sustainability and supply chain issues, waste handling of broken or old panels, and review of specific social issues, including plant's visual impacts, land acquisition and loss of grazing land, local employment opportunities, construction workers influx management, cultural heritage, and occupational and community safety among others. Semi-nomadic groups pass through the area for certain periods of the year and temporary settle in Al Safawi village. The adjacent Project roads are also used for access to local agricultural and touristic sites. The Client will develop a Labour and Working Conditions Plan that will specify, amongst other things, recruitment targets for employment of local/Jordanian nationals. Additionally, the Client will develop a Community Integration Plan to address sourcing of labour from local communities, including eligible refugees, and ensure due consideration is given to potential social conflicts arising from perceptions of unequal employment opportunities within these communities, specifying measures to avoid and address these potential conflicts, whilst ensuring compliance with Jordanian government policy. The nearest refugee camp, Azraq, is 50km away.

The Non-Technical Summary ("NTS") and Stakeholder Engagement Plan ("SEP") prepared for the Project are posted on Company's website in English and Arabic, as well as being made available as hard copies locally to facilitate information disclosure in the neighbouring communities. FRV is also planning to prepare a Community Integration Plan jointly with the EPC Contractor to manage employment expectations, consider potential local labour vocational training, and address any impacts arising from the joint infrastructure use and access to resources.

To ensure compliance with the Bank's PRs and to address the gaps identified at the ESDD, an ESAP will be agreed with the Client.

The Bank will monitor the implementation of the Project via annual E&S reports review and monitoring site visits as required.

Technical Cooperation

None.

Company Contact Information

Shalabh Arora
Shalabh.arora@frv.com
971 4 375 8554
http://www.frv.com/
23rd Floor, Unit 2304, Jumeirah Business Center, Cluster G, Building G2, Jumeirah Lake Towers,
P.O. Box 392632 Dubai, UAE

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