CNFL refinance credit and low cost of wind energy

February 24, 2014.

A successful financial trading allowed the National Power and Light Company (CNFL) save almost 50% on the cost per kilowatt installed in the wind farm, located in Santa Ana

Wind Farm Central Valley, 15.3 megawatts (MW) of capacity, developed a corporation created for this purpose between the Central American Bank for Economic Integration (BCIE) and the Company.

According to the terms of the contract, the electricity distributor would lease the plant for a period of 12 years and then would become part of their assets.

The plant began operations in late 2012 and its investment totaled $ 44.5 million. The cost per kilowatt was, according to CNFL than $ 0.13 (70 ¢). Initially, ICE had estimated $ 0.22 (¢ 118).

To build the plant, the company obtained a 12-year loan-two years were of grace, with a close interest at 8.5% (including cost of capital).

Marvin Cespedes CNFL managing director, said the former having greater opportunities of financial year on the market, achieved with better credit conditions: an interest rate of 6.40% in dollars and 30 years term.

This allowed the Company to pay the debt of the wind farm, acquire the shares held by the BCIE and thus reduce financial costs.

Thanks to this movement managed to lose $ 0.13 to $ 0.08 (43 ¢) per kilowatt cost.

The new financial conditions come from a joint credit from the Bank of Costa Rica and the National Bank, issued in mid-2013.

According to Marvin Céspedes, reducing borrowing costs, the Company may have a better operation and that benefits the end user.

"What happens is that we have three years of no adjustment in rates and customers have already noticed that benefit. Rather we have been making every effort to achieve close year with utility, "said the representative of the CNFL.

In May 2013, President Laura Chinchilla turned a directive to government agencies, ordering them to take steps to mitigate the increases in water rates, electricity and fuel. He also asked them to look for loans with more favorable terms to replace old and expensive debts.

Cespedes said the negotiation answered this call and a constant search for the company to cut costs.

CNFL, a subsidiary of the Instituto Costarricense de Electricidad (ICE), serves approximately 475,000 subscribers.

Source: La Nación