Italian developer Limes Renewable Energy is seeking financial partners for a portfolio of solar projects in Vietnam as it extends its footprint into Southeast Asia, Inframation has learned.
The Milan-based company has identified multiple sites for ground solar PV plants with a designed capacity of 30-110MW each, a source said. It now has access to a project pipeline totalling 500MW in Vietnam, its first overseas market.
The financial partners — preferably regional players — are expected to acquire equity stakes in the pipeline of projects. At this stage, Limes is looking to secure a total of USD 10m from the new investors.
“They can be Asian funds or industrial players such as utilities” with an established foothold in the market, the source said.
The Italian developer is in the process of obtaining land use permits, which would enable it to start engineering work. Once all regulatory approvals and engineering preparations are in place, Limes will aim to secure a 20-year PPA with Vietnamese state utility the Electricity of Vietnam (EVN) at a feed-in-tariff (FiT) of around USD 7.5-8.5 cents, the source said.
Construction is scheduled to start in the next 18-24 months following site development and financial close. The projects are being designed using fixed tilt structures and bifacial solar panels.
Meanwhile, the Italian developer is also examining a further 500MW of projects to add to its current pipeline in Vietnam.
The country, which aims to reach 12GW of solar capacity by 2030, has become a magnet for international renewable developers. It has enjoyed annual growth of 10% over the last five years, and is now expected to expand an annual 9% during the next five years. The government wants renewable energy sources to comprise 21% of the total energy output by 2030, compared with the current 5%.
Investors are in a race to register local solar projects in order to qualify for a FIT of USD 9.35 cents, a rate that will end in June 2019. There has been no indication of whether the tariff will change after that date.
During its first year in Vietnam, Limes opened offices in Hanoi and Ho-Chi Minh City and entered into strategic partnerships with local players – describing the market as “the centre of the region’s expansion” in a statement last week.
Earlier this year, the company sold shares to institutional investors in order to seed a 500MW development pipeline of unsubsidised solar farms in Italy.