Santa Rosa

In the province of Corrientes, Argentina, the town of Santa Rosa was facing a pressing challenge. The region’s timber industry, a pillar of local economic activity, was generating vast amounts of waste, including sawdust, wood chips, and forest thinning, that were often burned in the open, polluting the air and threatening the health of nearby communities. At the same time, local industries and neighboring towns were in need of a reliable, sustainable energy source to support growth and development. The government’s RenovAr Program, designed to promote renewable energy, presented a unique opportunity for Santa Rosa to address both environmental and economic needs through innovation.

Genergiabio, an Argentinian company, joined forces with Spanish renewable energy developer BAS to seize that opportunity. Their vision was to build an 18MW biomass power plant within the Santa Rosa Industrial Forest Park, converting forestry by-products into clean electricity. This plant would not only solve the pollution problem but also supply energy to the park’s industries and surrounding towns, enhancing the development of the entire region’s timber sector.

Transforming ambition into action required both technical expertise and financial ingenuity. The project’s total cost was USD 66.4 million, and its complexity demanded a robust financing structure. This is when CIFI stepped in as mandated lead arranger. Before the main loan, CIFI provided a USD 10 million bridge loan, enabling the sponsors to secure permits, finalize technical designs, and begin early works. When the time came for long-term financing, CIFI participated with USD 11.7 million in a USD 46.5 million senior secured loan, joining forces with other international and local lenders.

The financing was meticulously structured to mitigate risk and ensure success. The loan was secured by first-ranking interests over project assets, share capital, land rights, bank accounts, and insurance policies. The plant secured a 20-year, US dollar-denominated Power Purchase Agreement with CAMMESA, Argentina’s wholesale electricity market administrator, under the RenovAr framework. This agreement, backed by government guarantees, provided the project with stable, predictable revenue.

Environmental and social responsibility was embedded in the project’s core design. From the outset, the initiative was aligned with the International Finance Corporation (IFC) Performance Standards and the Equator Principles, ensuring adherence to globally recognized benchmarks for responsible investment. CIFI, together with independent consultants, conducted rigorous due diligence and established ongoing monitoring protocols to uphold compliance and drive continuous improvement throughout the project lifecycle.

The engineering, procurement, and construction contract was awarded to Dominion, a Spanish firm with a strong track record in biomass projects. The plant’s advanced design included high-efficiency steam turbines from Siemens and robust systems for pollution control.