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ADB, 10 banks to back Chinese waste-to-energy PPPs

The group has offered a combined $200m financing package to help a state-owned developer deliver at least nine PPPs in China’s smaller cities.

The Asian Development Bank has teamed up with 10 commercial lenders to provide $100 million to a waste-to-energy developer in China.

The transaction marks the multilateral’s inaugural onshore local currency complementary loan syndication in the country. Arranged by Bank of Tokyo-Mitsubishi UFJ, it saw the participation of commercial banks comprising the arranger, BNP Paribas, Cathay United Bank, CTBC Bank, Shanghai Pudong Development Bank, Fubon Bank, Hang Seng Bank, Shinhan Bank, Sumitomo Mitsui Trust Bank and Korea Development Bank. The offering was oversubscribed, according to the ADB.

In addition to the loan facility, the bank is providing a yuan-denominated A-loan equivalent to a maximum $100 million financed from its ordinary capital, as well as a technical assistance grant, to Dynagreen Environmental Protection Group, the environmental infrastructure arm of Beijing State-owned Assets Management Company.

The financing package will help the Chinese developer build at least nine waste-to-energy projects under the PPP model in small and medium-sized cities in the country. The new facilities are expected to generate around 610GWh of electricity a year by 2018. 

China currently counts 88 waste-to-energy projects, out of 11,260 schemes registered in the data base of its Public-Private Partnerships Center. The number of overall waste management-related projects stood at 388, as of December 2016. 

“The agreement will improve solid waste management in China’s smaller cities, and also increase energy generation from renewable sources to help diversify the country’s energy mix,” said Diwakar Gupta, ADB’s vice-president for private sector and cofinancing operations. 

In January 2016, the ADB also teamed up with 18 banks to provide a $200 million B-loan to China Water Affairs Group, earmarked for the expansion of existing water supply and distribution networks in China’s suburban and rural areas.