Europe’s Biggest Solar Park Completed With Russian Bank Debt

Europe’s biggest solar park was completed today after its Vienna-based developer, Activ Solar GmbH, obtained financing from two Russian banks.

Activ Chief Executive Officer Kaveh Ertefai said his company finished building the 100-megawatt photovoltaic plant in Perovo in the Crimea with funding from Moscow-based VTB Bank OJSC (VTBR) and Sberbank of Russia. (SBER) A project of this size typically costs about 300 million euros ($387 million), he said.

“We have completed one of the largest solar projects in the world while pioneering project financing in the Ukraine,” Ertefai said in an interview today by phone. “Availability of long-term finance is extremely tight.”

The company, which owns a polysilicon manufacturing plant in Ukraine, also developed the country’s first utility-scale solar facility in early 2011 and completed eastern Europe’s largest plant last month in Ohotnikovo in four phases each with 20-megawatts. It announced the completion the last 20 megawatt phase at Perovo yesterday.

Ukraine is seeking to increase its wind and solar capacity to reduce its dependence on coal and nuclear power, which provide 90 percent of its electricity. The country established a feed-in tariff until 2030, or fixed premium for power from clean sources, for large solar projects of 0.46 euros per kilowatt hour in late 2009.

Cost of Finance

Activ, which is the only company that has completed utility-scale solar parks in the country, developed the project for institutional investors in Europe, the chief executive said. Equity amounted to 30 percent to 40 percent of the total cost, he said.

While feed-in tariffs are higher than in most markets, the cost of finance is “much higher” in Ukraine because of the risks of doing business in the country, Ertefai said. Interest rates on loans are at least 10 percent there, he said.

The Perovo plant consists of 440,000 crystalline solar panels from four different suppliers and spans 200 hectares. Once connected to the grid, it will generate enough peak-load power to cover the electrical needs of Simferopol, Crimea’s capital.

The next-largest solar parks in Europe, both about to be connected, are in Germany. Q-Cells SE (QCE) developed a 91-megawatt plant in Brandenburg-Briest and Moehring Energie GmbH built an 84-megawatt project at Eggebek near the Danish border.

To contact the reporter on this story: Marc Roca in London at mroca6@bloomberg.net

To contact the editor responsible for this story: Reed Landberg at landberg@bloomberg.net

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