Eddie O'Connor's Mainstream Renewable Power has announced its involvement in the development of $1.4 billion of wind and solar projects in Chile.
London-based private equity company Actis LLP is also involved in the venture which comes as electricity shortages threaten the considerable mining industry in the South American nation.
Actis agreed to invest $290 million for a 60 per cent stake in developer Aela Energia, with the remaining shares held by Dublin-based Mainstream, Actis said in a statement. Mainstream will hold a 40 per cent stake.
The companies said the venture would build 600 megawatts of projects by 2016, which would boost Chile’s renewable capacity by 3.6 per cent and provide power for an estimated 131,000 homes.
Chile is the world’s biggest copper producer and needs to boost electricity supplies as power shortages jeopardise its $104 billion mine-project pipeline.
The country's energy minister Jorge Bunster said in April that the nation would add 1,000 megawatts in 2013 as power use grows 5.5 per cent to 6 per cent a year and demand from mines expected to jump an estimated 68 per cent in the coming decade.
“This platform is about meeting the needs of offtakers, particularly large-scale industrial consumers in Chile who need top-quality projects and competitive electricity prices,” Mainstream chief executive Officer Eddie O’Connor said in statement.
Aela Energia will buy the projects developed by Mainstream once financing contracts for the plants are signed. Mainstream will manage construction and operations, it said.
Actis, with $5.2 billion of funds under management, has already financed the Cerro de Hula project in Honduras, the nation's first wind farm.
Mainstream is developing more than 3,500 megawatts of renewable-energy plants in Chile and has worked with Actis before on wind and solar projects in South Africa.
Additional reporting: Bloomberg
