By Stanley Carvalho
Money raised from loans will be spent on building two 50MW solarfocused projects.
A solar energy joint venture between the UAE's Masdar and Spain's Sener has secured $760 million in loans for a $1 billion concentrated solar plant, executives involved in the venture said on Tuesday.
The joint venture, Torresol Energy, would use the money to build two 50 megawatt (MW) concentrated solar projects called Valle 1 and Valle 2 in Andalusia in southern Spain, Torresol said in a statement .
Conditions for raising financing had improved since last year but were still tough, said Jose Morales, chief financial officer for Sener, at a news conference in the capital of the UAE.
The financial crisis restricted the availability of credit in much of the world last year.
He said: "It was not as difficult as before, but challenging to secure finance."
The 20 year loan would come from seven Spanish institutions and the rest of the financing would come from Masdar and Sener as equity contributions, Morales said.
The plants were scheduled for completion in 2011, after construction began last March.
Torresol's first project, the $400 million Gemsolar central tower plant with capacity of 17 MW is under construction and would be operational in early 2011, Enrique Sendagorta, chairman of Torresol, said. That plant is in the province of Seville.
Valle 1 and Valle 2 would produce enough energy to power 80,000 homes and save 90,000 tonnes of CO2 emissions that would have otherwise been generated by conventional power generation, he said.
Torresol plans to build new solar power projects in southern Europe, North Africa, the Middle East and the south western United States, he added.
Concentrated solar power plants use the sun's rays to heat up liquid to generate stem power, much like conventional gas or coal plants. A reflective tower can be used to concentrate the sunlight.
Torresol Energy was established in March 2008. Sener holds 60 percent and Abu Dhabi government run Masdar holds the remaining 40 percent.
Masdar was created by the Abu Dhabi government to prepare the emirate for a future energy industry less dependent on oil and gas supply.
The UAE is the world's third largest oil exporter, and Abu Dhabi holds most of the UAE's crude reserves. (Reuters)