The International Finance Corporation (IFC), a member of the World Bank Group, has arranged a financial package of up to $188 million for the development of a 248 MW solar project in Jordan.

Developed by Masdar, Abu Dhabi’s renewable energy company, the Baynouna solar PV project is slated to be the country’s largest solar project to date.

“This is the latest in a series of efforts to boost renewable energy investments in a country faced with increased energy demand, in part driven by the growing refugee crisis,” the IFC said in a media statement.

Of the $188 million assistance proposed for the project, the IFC will provide $54 million from its own account while the remaining $134 million will be mobilized from other lenders, including a parallel loan from Japan International Cooperation Agency (JICA). This is the first time JICA has invested in a private project finance transaction in the middle eastern region.

Other lenders include Dutch Development bank FMO and Europe Arab Bank as B lenders. The OPEC Fund for International Development (OFID) and the German development bank DEG will be the parallel lenders for the project.

“The diversity of financial institutions supporting Baynouna illustrates both IFC’s successful track record with the private sector in emerging markets over the last 60 years and the strength of its commitment to best practice,” Mohamed Jameel Al Ramahi, CEO of Masdar, was quoted in the statement as saying.

For the past few years, Jordan has been reeling under a severe refugee crisis which has taken a toll on the country’s base of resources as well as burdened its power sector with increasing energy demands. “The new plant will supply power well below Jordan’s average cost of electricity, thus further lowering the cost of long-term electricity generation in the country,” the IFC’s statement said.

The IFC, a private investment arm of the World Bank, has been actively involved in the developing countries, providing them with the required investments and advisories to promote private sector’s development.

According to the IFC, it has invested over $300 million across 13 projects, enabling well over $1 billion in private sector investments in Jordan’s power distribution and generation sectors.

Mercom recently reported about the IFC’s plans to invest $150 million in Aditya Birla Finance Limited (ABFL) which would be used to develop solar projects in select states of India.

According to Q4 2017 Solar Funding and M&A Report by Mercom Capital Group, the large-scale project funding announced in 2017 reached a $14 billion raised in 167 deals, compared to $9.4 billion raised in 133 deals during 2016. A total of 161 investors funded about 20.5 GW of large-scale solar projects in 2017 compared to 5.9 GW funded by 153 investors in 2016.

Image credit: Masdar