Solariant closes financing on 50 MW biomass plant in Japan

By Solariant Capital | November 05, 2019

On Sept. 30, 2019, Solariant Capital, along with its equity partners, Chubu Electric Power Co. Inc., Mitsubishi UFJ Lease & Finance Co. Ltd., and Bio Fuel Co. Inc., have closed financing on a 50 MW biomass power generation project, developed by Solariant Capital, in Kamisu City, Ibaraki Prefecture, Japan.

The biomass plant project will be constructed, operated and managed through Kamisu Biomass Power Generation LLC, a joint venture project company among the four partners with a senior project debt arranged by Sumitomo Mitsui Trust Bank Ltd. and mezzanine debt through Mitsubishi UFJ Lease & Finance Co. Ltd. The 50 MWp plant will be utilizing biomass fuel, primarily palm kernel shell (by product of palm oil) and wood pellets to produce approximately 350 gigawatt hours (GWh) of electricity annually, which is equivalent to an amount consumed by 110,000 households in Japan. The fuel for the biomass plant will be provided based on long-term supply contracts with four Japanese trading houses. The plant will also utilize wood pellets produced by Lumino Biomass Fuel Inc., a wholly owned subsidiary of Solariant Capital LLC.

The EPC general contractor is a joint venture entity between Hitachi Zosen and Okumuragumi with the CFB boiler and the generator from General Electric Co and Toshiba Mitsubishi-Electric Industrial Systems Corp, respectively. The O&M contractor is JERA, one of the largest independent power producers in Asia. The construction of the plant will begin at the end of 2020 and is scheduled to start operation in July 2023. The energy generated by the power plant will be sold to Tokyo Electric Power Co. (TEPCO) at a fixed rate of 24 yen plus value added taxes per kWh for 20 years under the current feed-in tariff program (renewable energy subsidy program). Japan enacted its current renewable energy subsidy program in July of 2012.