DFI loans propel Honduran wind farm

A group of mainly European development finance institutions have come forward with $127.5m of financing for the San Marcos project.

The San Marcos wind project in Honduras has secured $127.5 million in senior debt financing in total from five different organisations.

The loans have been provided by: FMO (Netherlands Development Finance Company), which was lead arranger; German development finance institution DEG; PROPARCO, the private sector investment arm of French development finance body Agence Francaise de Developpement; OFID, the development finance arm of OPEC (the Organisation of Petroleum Exporting Countries); and the Interact Climate Change Facility (ICCF), a private Luxembourg company funded by 13 different development finance institutions.

San Marcos is owned by Vientos de Eletrotecnia, which is part of Grupo Terra, a family-owned Honduran energy company which has refocused over the last 10 years on renewable energies including wind and hydro.

Located in the south-west of Honduras, near the Nicaraguan border, the 50-megawatt (MW) project involves the installation of 25 turbines. Construction of the wind farm has started and commercial operation is expected to commence in early 2015. Substations and interconnection lines are being built to allow connection to the national grid.

San Marcos is intended to help Honduras lessen its reliance on imported fossil fuels for its electricity. The country has a target of producing at least 80 percent of its energy from renewable sources by 2034.