ADB, GreenYellow sign deal for rooftop solar in VN

Tuesday, Sep 12, 2023 22:12

The Asian Development Bank (ADB) and GreenYellow Smart Solutions Vietnam Co., Ltd. have signed a US$13.8 million to support the development and operation of rooftop solar PV systems on commercial and industrial businesses across Việt Nam. — File Photo

The Asian Development Bank (ADB) and GreenYellow Smart Solutions Vietnam Co Ltd (GreenYellow), have signed a loan agreement of up to US$13.8 million for rooftop photovoltaic (PV) solar systems to help increase the supply of clean and affordable energy for commercial and industrial consumers in Việt Nam, ADB said in a press release on Monday.

The loan will support the development and operation of solar PV systems located on the rooftops of commercial and industrial businesses across the country.

The financing package comprises a $3 million loan from ADB’s ordinary capital resources and $10.8 million parallel loans from FMO, responsAbility Fund, and Société Générale, with ADB as mandated lead arranger.

A $3 million grant from the Climate Innovation and Development Fund (CIDF), administered by ADB, will also be provided, which will help crowd in an international commercial bank by addressing two critical hurdles in financing solar assets with a long economic life in Việt Nam: the lack of long-term dong funding at a fixed interest rate, and potential volatility of the đồng–US dollar exchange rate.

ADB Director General for Private Sector Operations Suzanne Gaboury said: “Solar PV rooftop offers an efficient way for Việt Nam to deploy substantial amounts of additional renewable energy capacity while providing reliable, low-cost energy to consumers, which helps to attract and retain business and enhance Việt Nam’s global competitiveness.”

This is ADB’s first financing of a solar PV rooftop portfolio for the commercial and industrial segment in Việt Nam.

According to ADB, rooftop solar is an emerging form of renewable energy supply in Việt Nam and its adoption in this sector has been hindered by high upfront costs and limited financing channels.

With a planned total installed capacity of up to 32.3 megawatts at its peak, this project is set to increase clean energy supply to the sector by at least 31.5 gigawatt-hours annually, reducing 15,530 tonnes of carbon dioxide emissions by 2025, the bank said.

CIDF is a blended finance facility managed by ADB, established in September 2021 with an initial $25 million philanthropic commitment from Bloomberg Philanthropies and Goldman Sachs. The fund has the potential to unlock up to $500 million in private sector and government investments to support sustainable low-carbon economic development. — VNS

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