Canadian Solar has reached a financial close of its 126 MWp Tastiota project in the state of Sonora, Mexico.

Sumitomo Mitsui Banking Corporation (SMBC) offered the non-recourse financing package, arranged by Canadian Solar. SMBC served as Sole Structuring Bank and Mandated Lead Arranger in the deal.

The Tastiota financing package consists of a $67 million senior loan, a $15 million letter of credit facility and a $12 million VAT facility for the construction and operation phase of the project.

Following the sale in November 2019 of the 49 percent stake in the 370 MWp portfolio of Mexican projects to Korea Electric Power Corporation (KEPCO), South Korea’s largest electricity utility, and to Sprott Korea (Sprott), a leading fund manager, these parties entered into an agreement to acquire the remaining interest of Canadian Solar in the projects after their commercial operation date.

The Tastiota project was granted a Power Purchase Agreement (PPA) during Mexico’s third energy auction. Electricity generated by the project will be sold to the Federal Electricity Commission (CFE) under a 15-year PPA for energy and ability and a 20-year PPA for Clean Energy Certificates.

The 126 MWp solar power plant will use the high-efficiency BiHiKu modules supplied by Canadian Solar and is expected to be operational by the end of 2020.

“We are very pleased to partner with SMBC to support Mexico’s green strategy and renewable energy goals. We are also delighted to collaborate with our global partners KEPCO and Sprott to advance this project. The closing of this non-recourse project finance during these extraordinary times is a strong sign of financial markets’ confidence in Canadian Solar’s vision and ability to deliver clean solar energy in Mexico and Latin America more broadly. I am proud of our teams’ accomplishments in contracting 436 MWp of PPAs in Mexico, which is part of a broader 2.9 GWp portfolio of project backlog across Latin America. We remain focused on serving this market and maintaining our valued relationships with energy regulators, investors, customers, suppliers and business counterparties, as well as supporting continued job creation across the renewable energy sector.”

Dr. Shawn Qu, chairman and CEO of Canadian Solar.