ENGIE ENERGIA PERU S.A. (FMO-61609)

Regions
  • Latin America and Caribbean
Geographic location where the impacts of the investment may be experienced.
Countries
  • Peru
Geographic location where the impacts of the investment may be experienced.
Financial Institutions
  • Netherlands Development Finance Company (FMO)
International, regional and national development finance institutions. Many of these banks have a public interest mission, such as poverty reduction.
Project Status
Approved
Stage of the project cycle. Stages vary by development bank and can include: pending, approval, implementation, and closed or completed.
Bank Risk Rating
B
Environmental and social categorization assessed by the development bank as a measure of the planned project’s environmental and social impacts. A higher risk rating may require more due diligence to limit or avoid harm to people and the environment. For example, "A" or "B" are risk categories where "A" represents the highest amount of risk. Results will include projects that specifically recorded a rating, all other projects are marked ‘U’ for "Undisclosed."
Borrower
Engie Energía Perú S.A.
A public entity (government or state-owned) provided with funds or financial support to manage and/or implement a project.
Sectors
  • Energy
The service or industry focus of the investment. A project can have several sectors.
Investment Type(s)
Loan
The categories of the bank investment: loan, grant, guarantee, technical assistance, advisory services, equity and fund.
Investment Amount (USD)
$ 100.00 million
Value listed on project documents at time of disclosure. If necessary, this amount is converted to USD ($) on the date of disclosure. Please review updated project documents for more information.
Loan Amount (USD)
$ 100.00 million
Value listed on project documents at time of disclosure. If necessary, this amount is converted to USD ($) on the date of disclosure. Please review updated project documents for more information.
Primary Source

Original disclosure @ FMO website

Updated in EWS Aug 13, 2023

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Project Description
If provided by the financial institution, the Early Warning System Team writes a short summary describing the purported development objective of the project and project components. Review the complete project documentation for a detailed description.

WHO IS OUR CLIENT

ENGIE Energia Peru S.A. is the second largest private power generation and energy infrastructure company in Peru, supplying over 10% of the total power consumed in the country. ENGIE Energia Peru's shares are listed in the Lima Stock Exchange. The Company has a local credit rating of AAA (stable) by Moody's and Fitch. ENGIE Energia Peru is part of ENGIE Group, which is present in around 50 countries. In Latin America, ENGIE Group is present in Argentina, Chile, Colombia, Mexico and Peru. ENGIE Energia Peru is working on a more sustainable power generation, to align with the ENGIE Group's goal of being Net Zero Carbon by 2045, reaching an installed renewable energy capacity of 80 GW by 2030, and exiting all coal assets globally by 2027.

FUNDING OBJECTIVE

FMO will follow IDB under its A-loan through a Participation Agreement between IDB and FMO. The transaction is a Corporate loan and the funds will expand ENGIE Energia Peru's renewable portfolio in Peru through the construction of the Punta Lomitas Wind Farm, a 296 MW greenfield wind farm and 60 kilometers of an associated transmission line, located about 300 kilometers south of Lima. It will be the Company's first wind farm and the largest of its kind in Peru. ENGIE Group is very active in wind energy globally (on and offshore as well floating) with the aim to reach 80GW in 2030.

WHY WE FUND THIS PROJECT

The loan will be used for 100% green power generation project, as well as it provides an opportunity to FMO to gain presence in Peru. This financing will provide longer-term liquidity that is not available in the local market given the current COVID-19 context and political instability in Peru. Currently only 1-2% of the estimated potential of wind and solar sources is being harnessed in Peru. This transaction will help the country to continue benefitting from its renewable energy potential given its privileged resource availability by diversifying the energy matrix towards cleaner sources and reducing its carbon intensity.

ENVIRONMENTAL AND SOCIAL RATIONALE

FMO's E&S Category for this transaction is B+. ENGIE Energia Peru has a very proactive approach to E&S and has received awards on their ESG practices. At the corporate level, ENGIE has several E&S policies including: (i) Social; Occupational Health and Safety; (iii) Environmental; (iv) Salary; (v) Corporate Sustainability. The following IFC Performance Standards are triggered: 1-4, 6, and 8. IFC PS5 and 7 are not considered triggered as the wind farm is not located in sites considered of high archaeological, paleontological or cultural value, and there will not be any impacts on indigenous people. Plans and mitigants have been put in place or are part of the Environmental and Social Action Plan (ESAP) items to mitigate construction and operation risks.

Investment Description
Here you can find a list of individual development financial institutions that finance the project.
Private Actor 1 Private Actor 1 Role Private Actor 1 Sector Relation Private Actor 2 Private Actor 2 Role Private Actor 2 Sector
- - - - ENGIE Undisclosed -

Contact Information
This section aims to support the local communities and local CSO to get to know which stakeholders are involved in a project with their roles and responsibilities. If available, there may be a complaint office for the respective bank which operates independently to receive and determine violations in policy and practice. Independent Accountability Mechanisms receive and respond to complaints. Most Independent Accountability Mechanisms offer two functions for addressing complaints: dispute resolution and compliance review.

ACCESS TO INFORMATION

As part of FMO's ex-ante disclosure (disclosure of transactions before contracting), you can send requests or questions for additional information to: disclosure@fmo.nl

ACCOUNTABILITY MECHANISM OF FMO

Communities who believe they will be negatively affected by a project funded by the Dutch Development Bank (FMO) may be able to file a complaint with the Independent Complaints Mechanism, which is the joint independent accountability mechanism of the Dutch Development Bank (FMO) and the German Investment Corporation (KfW). A complaint can be filed in writing, by email, post, or online. The complaint can be filed in English or any other language of the complainant. The Independent Complaints Mechanism is comprised of a three-member Independent Expert Panel and it can provide either problem-solving, compliance review or both, in either order. Additional information about this accountability mechanism, including a guide and template for filing a complaint, can be found at: https://www.fmo.nl/independent-complaints-mechanism

How it works

How it works