EIB and Enel Group: Leading the Energy Transition in Colombia
The European Investment Bank (EIB), in collaboration with Enel Group’s subsidiary Enel Colombia and SACE, the Italian Export Credit Agency, is making significant strides in supporting the energy transition in Latin America. Recent developments include a landmark loan agreement designed to finance crucial projects in Colombia’s renewable energy and power distribution sectors.
Innovative Financing to Catalyse Renewable Energy
At the heart of this agreement is a substantial loan provided in Colombian pesos, with a maximum value equivalent to $300 million. What sets this loan apart is its use of a synthetic product that neutralises exchange rate risks, an innovative approach that marks this as the first loan of its kind from the EIB to any Enel Group subsidiary. This strategic financial backing is underscored by a SACE guarantee, reinforcing the synergy between public and private entities. The ultimate goal is to bridge the infrastructure gap in Colombia and boost the share of renewable energy in the national energy matrix.
Strategic Projects for Sustainable Development
The funds from the loan are earmarked for pivotal projects within Colombia. Specifically, they will finance the solar photovoltaic (PV) plants, Guayepo I and II, which collectively promise a capacity of approximately 486 MW. Additionally, the loan supports enhancements to the Enel Colombia distribution network, benefitting over 3.7 million customers in Bogotá. These investments are poised to enhance network resilience, enhance new connections, and foster e-mobility as part of the Bogotá Region 2030 project.
A Model for Public-Private Partnerships
This agreement builds upon the EIB’s extensive collaboration with Enel and SACE throughout Latin America, previously paving the way for facilities exceeding $900 million across multiple countries and currencies for Enel Group’s subsidiaries. This ongoing cooperation reflects the synergy between public and corporate sectors, a factor that Stefano De Angelis, CFO of Enel, highlights as crucial in driving forward their strategic goals focused on renewables and sustainable grid development.
Aligning with Global Sustainability Goals
Importantly, this initiative aligns with the EU Commission’s Global Gateway Investment Agenda and supports global efforts towards achieving the Sustainable Development Goals (SDGs) as well as the commitments outlined in the Paris Agreement and the UN 2030 Agenda. EIB Vice-President Ioannis Tsakiris expressed optimism that this collaboration will help reduce the infrastructure disparities within Colombia while bolstering the generation of renewable energy.
Expanding Opportunities in Latin America
SACE’s Chief Business Officer, Valerio Perinelli, has reiterated the strategic importance of Colombia and Latin America as a whole, both as a hub for the energy transition and as a marketplace for Italian technological innovation. With SACE recently establishing an office in Bogotá, the stage is set for continued support and development, highlighting their commitment to fostering sustainable growth across the region.
This forward-thinking partnership exemplifies the effective use of innovative financial instruments and cross-border cooperation to meet sustainability objectives, providing a blueprint for similar initiatives globally. With Enel and its partners at the helm, Colombia is poised to become a leader in renewable energy transformation in Latin America.
What you have to learn
| Aspect | Details |
|---|---|
| Main Partners | European Investment Bank (EIB), Enel Colombia (Enel Group), SACE (Italian Export Credit Agency) |
| Financing Objective | Support Colombia’s energy transition and bridge infrastructure gaps in renewable energy sectors |
| Loan Amount | Up to $300 million equivalent in Colombian pesos |
| Loan Structure | Innovative local currency loan with synthetic product to mitigate exchange rate risks, guaranteed by SACE |
| Projects Funded | – Guayepo I and II solar photovoltaic (PV) plants (total capacity of 486 MW) |
| – Reinforcement of Enel Colombia’s distribution network to improve resilience and promote e-mobility | |
| Project Beneficiaries | Approximately 3.7 million customers in the Bogotá region |
| Strategic Goals | Development of renewable energy, modernization of infrastructure, promotion of electric mobility |
| Alignment with Global Goals | Supports the EU Global Gateway Agenda, UN Sustainable Development Goals (SDGs), the Paris Agreement, and the 2030 Agenda |
| Geographic Scope | Colombia, with regional impact across Latin America |
| Similar Projects in Latin America | Over $900 million in facilities provided with Enel and SACE across several Latin American countries |
| Environmental and Social Impact | Increased share of renewable energy in Colombia, reduction of infrastructure disparities |
| Partner Comments | – Ioannis Tsakiris (EIB VP): optimistic about reducing infrastructure disparities in Colombia |
| – Valerio Perinelli (SACE): highlights the importance of Colombia and Latin America for Italian tech innovation | |
| Future Prospects | SACE’s enhanced presence with a Bogotá office, creating opportunities for similar global initiatives |