Summary sheet
Financing of the construction and operation of a solar photovoltaic (PV) plant for a total capacity of about 245 MW in the Italian region of Sicily.
The project consists of the construction and operation of a ground-mounted solar PV plant for a total capacity of about 245 MW in the Italian region of Sicily.
The Project increases the renewable energy generation capacity in Italy and contributes to national and EU 2030 climate objectives. The financing of the Project is in line with the Bank's lending priority objectives on "Renewable Energy" as well as on "Climate Action, Environmental Sustainability" and "Social and Economic Cohesion".
The Project produces electricity from low carbon sources (solar photovoltaic "PV" plants), addressing the market failure of negative climate and environmental externalities, through the reduction of carbon emissions and other air pollution (compared to fossil-fuel generation).
According to the route to market strategy of the Promoter, the Project is expected to rely on a mix of merchant revenues and "PPA" (Power Purchase Agreements) contracts, in a sector characterised by incomplete markets (limited forward/hedging, lack of scarcity pricing and lack of locational pricing), and it improves market efficiency and competition. The PV plants are located in an EIB Cohesion Priority region. Therefore, the Project is expected to yield excellent quality and results due to economic rate of return, broader social benefits and fair employment creation.
The Bank's financial contribution to the Project is very good thanks to conditions more favourable than market alternatives (lower pricing, longer tenor and disbursement periods, etc.). The value added provided by the EIB is even more tangible under the current market volatility, impacted by the ongoing geopolitical issues. The "EIB Green Loan" label is considered very valuable to the Promoter.
The project and associated infrastructures have been screened in and underwent an environmental impact assessment (EIA) process according to EIA Directive 2011/92/EU as amended by Directive 2014/52/EU, including public consultation, obtaining environmental permit in June 2021. The authorisation procedure and compliance with the relevant EU directives, specifically Habitats and Birds Directives (92/43/EEC and 2009/147/EC respectively), will be assessed at appraisal, in particular the potential cumulative impacts assessment and the impacts on protected flora and fauna, including Natura 2000 sites. Given that China largely dominates the market of photovoltaic solar panels, and media reports about the risk of forced labour, the Bank will apply an enhanced due diligence on the topic, in line with the EIB's Environmental & Social Standards. The project is expected to contribute to Climate Action and Environmental Sustainability (CA&ES) objectives, in particular to climate change mitigation and pollution prevention and control.
The promoter has been assessed by the EIB as being a private company not being subject to EU rules on public procurement or concessions. However, if at the project appraisal, the EIB were to conclude that the promoter is subject to the EU public procurement legislation then the Bank would duly inform the Commission Services and would require the promoter to apply those rules.