GE Energy Financial Services is aggressively expanding its presence in solar power markets across the world. The company’s latest investment has been announced just weeks after an investment was made in the largest solar power project in India.
GE Energy Financial Services has announced that it will invest in a 32 MW solar photovoltaic power project in Japan being developed by Pacifico Energy.
According to a press release by Pacifico Energy, a loan worth about $110 million will also be provided to the project by The Bank of Tokyo-Mitsubishi UFJ and the Chugoku Bank.
The project is believed to take advantage of the feed-in tariff scheme launched by the government in 2012 following the Fukushima nuclear accident.
The construction of the project is expected to start soon and commercial operation is planned for the first quarter of 2016. The power generated from the project will be sold to one of the regional power utilities through a 20-year power purchase agreement.
The project will be constructed by Toyo Engineering Corporation and the modules will be supplied by Yingli Green Energy.
GE Energy Financial Services has so far made financial commitments over $10 billion in the renewable energy sector across the world. These include investments of $8 billion in wind energy projects and $1.7 billion in solar energy projects.
In May 2014, GE Energy Financial Services invested $24 million in a 151 MW solar PV project in India owned by Welspun Energy. The equity investment was similar to the one the company has made in the Japan project with the only significant difference being that the Indian project is already operational while the construction on the Japanese project is yet to begin.
Pacifico Energy may follow the same strategy as Welspun Energy did on receiving the equity infusion and use the resources to pay off a portion of the loan acquired.
While this is the first investment made by GE Energy Financial Services in Japan, the company has ambitious plans to expand its footprint in the country. The company plans to invest in the largest solar power project in Japan, the 430 MW project to come up at Setouchi.
The Japanese government reduced the feed-in tariff for larger solar power projects by about 10% during the current financial year but the country is expected to remain an attractive solar power market. The government approved 6.7 GW of solar power capacity in 2013 and about 10 GW capacity is expected to be installed this year.
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