Asian investors commit $150m to Arctic Green Energy
CITIC Capital and China Everbright have committed $100 million in debt and equity funding to Iceland-based geothermal energy developer Arctic Green Energy (AGE), alongside a $50 million loan facility provided by the Asian Development Bank (ADB).
CITIC, an existing investor in AGE, invested $30 million, while newcomer China Everbright paid $70 million for shares and an exchangeable bond issued by the company. AGE will use the fresh capital to support its growth strategy and to refinance existing debt, according to a statement.
AGE was founded in 2002 with the aim of exporting Iceland’s expertise in geothermal energy, which produces around 30% of the island nation’s electricity and powers the heating and hot water needs of 87% of its housing. Most of its projects are in Asia, reflecting the region’s appetite for non-polluting solutions to its growing energy demands.
Its flagship project is Sinopec Green Energy, a joint venture with China’s Sinopec that operates in 40 cities in China and produces 3.65 thermal gigawatts of energy annually. The company also launched the Orka geothermal power plant in the Philippines in 2011; following the end of construction it sold its stake to local partners in 2015.
CITIC first invested in AGE in 2015 alongside Kazyna Capital Management, a subsidiary of Kazakhstan’s sovereign wealth fund. The investors formed a JV with AGE as part of China’s One Belt One Road (OBOR) initiative to introduce air pollution prevention technology to China and other OBOR countries.
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