Etrion Corporation (“Etrion” or the “Company”), a solar independent power producer, announces an update to its solar photovoltaic projects in Chile.
Marco A. Northland, Etrion’s Chief Executive Officer, commented: “I am very pleased with the significant progress our Chilean team has achieved to date in construction and development. Etrion is one of the early movers in solar power generation in Chile and today has 70 MW operational and more than 99 MW under development.”
Mr. Northland continued, “Chile is one of the most attractive solar markets in the world. Chile has very high solar irradiation, an investment grade credit rating, a deregulated electricity sector with contracts denominated in US dollars, significant energy demand from the mining sector and high wholesale electricity prices. This combination of factors makes Chile one of the first solar markets in the world to reach grid parity, where solar is competitive with traditional sources of power generation without the need for government subsidies.”
Chilean Project in Operation (70 MW)
As previously announced, Etrion completed construction of the 70 megawatt (“MW”) Salvador solar park in northern Chile (“Project Salvador”) in November 2014, several months ahead of schedule and under budget. Project Salvador is owned initially 70 percent by Etrion, 20 percent by Total S.A. and 10 percent by a local developer. The solar park was built by SunPower Corporation (“SunPower”) and has a long-term, fixed-price operation and maintenance agreement with SunPower. In 2014, Project Salvador produced approximately 6.7 million kilowatt-hours (“kWh”) of electricity during commissioning and testing. Project Salvador is expected to enter full operational phase by February 2015.
Project Salvador will initially operate on a merchant basis where the electricity produced will be sold on the spot market and delivered to the Sistema Interconectado Central (“SIC”) electricity network. In order to secure a portion of the revenues, Project Salvador expects to sign a long-term power purchase agreement (“PPA”) with an investment grade off-taker in Q1-2015. Project Salvador recently signed a binding letter of intent with the off-taker to outline the commercial terms of the PPA for approximately 35 percent of Project Salvador’s production. The PPA is expected to be for 15 years starting January 1, 2016, at approximately US$0.10 per kWh indexed to the US Consumer Price Index (“CPI”).
Chilean Advanced Project Development Pipeline (99 MW)
Etrion has an advanced development project pipeline in Chile of four projects totaling 99 MW outlined below. These projects are owned 100 percent by Etrion and are expected to have all permits in place to be shovel-ready in Q1-2015.
The Aguas Blancas solar projects in the Antofagasta region include three sites, 2A, 2B and 2C, with a total capacity of 72 MW in the Sistema Interconectado del Norte Grande (“SING”) electricity network.
Aguas Blancas 2A is a 32 MW site with the land concession decree expected in Q1-2015. The environmental impact assessment has been received, the interconnection contract has been agreed and the mining rights have been secured.
Aguas Blancas 2B is a shovel-ready 24 MW site. The land concession decree has been signed, the environmental impact assessment has been received and the mining rights have been secured. The interconnection contract and the PPA with a mining company are under advanced negotiations.
Aguas Blancas 2C is a 16 MW site with the land concession decree signed. The environmental impact assessment has been received, the interconnection contract has been agreed and the mining rights have been secured.
Las Luces is a 27 MW solar project in the Atacama region with one site in the SIC electricity network. The land concession decree has been signed, the environmental impact assessment has been received, the interconnection contract is under advanced negotiations and the PPA negotiations have started.
Etrion should be in a position to start construction of these pipeline projects once the Company secures PPAs and the necessary non-recourse project financing. The projects are expected to be operational within twelve months from the date construction commences.
Etrion plans to finance its projects under development through the most efficient combination of cash on hand, non-recourse project loans, corporate debt and/or equity financing.
Etrion Corporation is an independent power producer that develops, builds, owns and operates utility-scale solar power generation plants. The Company owns 130 MW of installed solar capacity in Italy and Chile. Etrion has 34 MW of solar projects under construction in Japan and is also actively developing greenfield solar power projects in Japan and Chile. The Company is listed on the Toronto Stock Exchange in Canada and the NASDAQ OMX Stockholm exchange in Sweden under ticker symbol “ETX”. Etrion’s largest shareholder is the Lundin family, which owns approximately 24 percent of the Company’s shares directly and through various trusts.