KfW IPEX-Bank finances 378 MW LNG-to-power project in El Salvador

KfW IPEX-Bank is financing the 378 MW LNG-to-power project “Energía del Pacífico” (“EDP”) in El Salvador. The overall investment volume adds up to USD 877 million, with KfW IPEX-Bank, together with Finnish Export Credit (“FEC”) and Finnvera, providing a loan tranche of USD 142 million. Development, construction and operation of the project have been awarded to the US-based global developer and operator of sustainable energy solutions Invenergy and the local firm Quantum Energy. The power plant will be supplied by the Finnish Wärtsilä Corporation, one of the world's leading manufacturers of power plants and power plant components.

The project framework consists of the construction of a highly flexible natural gas-fired baseload power plant, including 19 Wartsila “FlexiCycle” 18V50SG natural gas combustion reciprocating-engines and one 30 MW common steam turbine generator. In addition, it includes the construction of (i) sub-sea and marine pipeline infrastructure to connect to an offshore Floating Storage and Regasification Unit (“FSRU”) for supplying LNG, (ii) an onsite substation and (iii) a 44 km transmission line connecting to a substation at Ahuachapán on the border with Guatemala.

The EDP project adds 23% to El Salvador’s available installed capacity and aims to (i) displace polluting and CO2 intense heavy fuel oil-based thermal generation and supplement current and planned renewables capacity and (ii) help keep electricity prices stable and meet the country’s increasing electricity demand on a long-term basis. At the same time, El Salvador's dependence on energy imports is to be reduced.

With this financing, KfW IPEX-Bank can once again underscore its expertise in the forward-looking market of electricity generation from liquid natural gas, which has high growth potential and contributes to environmental and climate change mitigation as well as to security of supply.