Renalfa IPP has secured a €315 million (US$367 million) financing package from an EBRD-led consortium to support a 1.6GW renewables, 3.3GWh BESS rollout in Bulgaria, Hungary, Romania, and North Macedonia.
The Holdco Financing is being provided by a group of lenders led by the European Bank for Reconstruction and Development (EBRD).
It will support Renalfa IPP’s €1.2 billion investment plans which totals around 1.6GW of generation assets and 3.3GWh of co-located battery energy storage systems (BESS) in the four countries in Central and Eastern Europe (CEE).
Energy-Storage.news readers may be familiar with the company as the owner of a 25MW/55MWh BESS in Bulgaria, the largest one to be commissioned in the country when it came online last year. Since Renalfa’s 55MWh Bulgaria project came online, one nearly ten times larger, claimed as the largest in the EU, was commissioned (in May this year).
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The company is a joint venture between Vienna-based clean energy investor Renalfa Solarpro Group and French infrastructure fund manager RGreen Invest. Renalfa IPP’s CEO Ivo Prokopiev commented:
“The successful raising of growth funding is an important milestone for Renalfa IPP and for our whole group. It proves the competitiveness of our integrated model for developing, investing and operating large hybrid assets. The early implementation of long duration co-located BESS allows Renalfa IPP to start offering green baseload products to market in CEE for the first time.”
Storage activity in the CEE region has ramped up in the last 12 months, particularly in Bulgaria, Romania and Hungary, largely driven by project capex support grant schemes with EU funding – see all recent coverage of the region here.
Financing structure reduces risk for lenders
The EBRD lent €100 million on its own account and mobilised an additional €100 million from commercial participants under an A/B loan structure. The structure is one where the ‘A’ lenders, primarily development finance institutions like EBRD, partner with ‘B’ lenders, typically commercial banks. The lead A lender acts as arranger, lender of record and facility agent.
The EBRD secured the ‘first loss guarantee’ for the transaction from InvestEU, a programme set up to mobilise private investment in the EU. A first loss guarantee is one where a guarantee provider agrees to bear losses incurred up to an agreed percentage in the event of default by the borrower.
It’s the first time that the EBRD has used the guarantee for an A/B loan, which means that the commercial banks participating in the loan benefit indirectly from EU risk-sharing support. The guarantee helps address risks associated with merchant-based renewable power generation and energy storage, EBRD said.
Other lenders in the €315 million package were Black Sea Trade and Development Bank (BSTDB), OTP Bank (OTP), Nova Ljubljanska Banka (NLB), UniCredit, and Kommunalkredit. As part of the transaction, the EBRD will support the development of a training programme in BESS-related skills for both existing staff and future professionals in the region. Renalfa will also partner with local universities to deliver an outreach campaign aimed at attracting women to careers in the energy sector.
