F I RST E DI TI O N
Caribbean Basin
Renewable Energy Investment Index
MA RC H 2 0 1 7
P A N A M F I N A N C E . C O M
Table of Contents
Page
Content
3
OVERVIEW
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5
COUNTRY SUMMARY AND SNAPSHOTS
6
7
8
9
10
11
12
13
14
15
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Country
Country
Country
Country
Country
Country
Country
Country
Country
Country
snapshot:
snapshot:
snapshot:
snapshot:
snapshot:
snapshot:
snapshot:
snapshot:
snapshot:
snapshot:
Costa Rica
Cuba
Dominican Republic
El Salvador
Guatemala
Honduras
Jamaica
Nicaragua
Panama
Trinidad & Tobago
-
16
METHODOLOGY AND INDEX CALCULATION
16
17
18
19
20
21
22
Methodology
Index calculation
Index calculation
Index calculation
Index calculation
Index calculation
Index calculation
23
25
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–
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Macro Parameters
Energy Parameters
Policy Parameters
Investment Parameters
Country Summary
Conclusion
ABOUT PAN AMERICAN FINANCE
DISCLAIMER AND SOURCES
page 2
Overview
As the Central American and Caribbean economies continue to grow, so has
the demand for energy. While oil and gas prices have fallen, renewables
have become increasingly more cost-competitive and, as pressure grows to
reduce their carbon footprint, countries in the Caribbean Basin are favoring
a transition towards cleaner energy.
«
»
In fact, despite sharply declining oil prices, investment
in renewable energy reached a record-high in 2015,
with US$349bn invested worldwide.
The potential for renewable energy in the Caribbean
Basin is significant.
1
Electricity costs across the region are particularly high,
legislative frameworks by governments across the region,
driven by continued dependency on oil and gas as fuel for
coupled with fiscal incentives, that is propelling the
power generation, and by aging electrical infrastructure. The
development of renewable energy. While Central America is
economies of the region have been particularly vulnerable to
already a leader in hydropower and geothermal energy, with
the volatility of oil prices, as most of these countries must
countries like Costa Rica currently generating as much as
import all oil products. On the other hand, renewables act as
99% of its electricity from renewable sources , it is wind and
an incentive for development, since they can contribute to
solar power that offer the highest potential for growth . With
lower energy prices while minimizing economic volatility. In
declining construction costs for wind and solar projects,
the last decade, development of new renewable energy
many countries in Latin America have opted to procure
projects in the Caribbean Basin has been inconsistent as
renewable energy through competitive auctions. The
PetroCaribe provided access to highly subsidized oil from
combination of competitive bidding and strong wind and
Venezuela,
3
4
from
solar resources has pushed bid prices well below those seen
developing alternative sources of energy . However, as
in most other markets. Average bid prices have dropped
Venezuela’s economy has faltered, Petrocaribe is no longer a
substantially in the last six years and Chile has become the
reliable option. While development banks have played a key
latest pace-setter in the worldwide race to deliver
role in the expansion of renewable energy projects across the
super-cheap utility-scale solar power with a bid as low as
region, it is the increase in efforts to create policies and
29.1 $/MWh.
disincentivizing
recipient
countries
2
Bloomberg New Energy Finance. 2 Johanna Mendelson Forman, “After Petrocaribe New Sources Key to Caribbean Energy Security,” World Politics Review, April 10,
2015. Also, Cristina Maza, “Venezuela’s Collapse Prods Region toward Kicking Its Oil Habit,” The Christian Science Monitor, May 20, 2016.
3
CENCE (Centro Nacional de Control de Energía de Costa Rica). 4 IRENA.
NOTE: Renewable energy is defined as energy that is collected from renewable sources. The report considers energy from wind, solar, biomass, geothermal and
hydro as renewable energy.
1
page 3
Country Ranking
In this 1st Edition of Pan American Finance´s Caribbean Basin Renewable
Energy Investment Index, we set out to rank the 10 selected countries in the
Caribbean Basin region in terms of investment potential in renewable
energy projects.
RANKING
1
2
3
4
5
6
7
8
9
10
COUNTRY
PANAMA
GUATEMALA
JAMAICA
COSTA RICA
DOMINICAN REPUBLIC
HONDURAS
NICARAGUA
EL SALVADOR
TRINIDAD & TOBAGO
CUBA
page 4
Country Summary
and Snapshots
For the 1st Edition of Pan American Finance´s Caribbean
The total installed energy generation capacity in the Caribbean
Basin Renewable Energy Investment Index, we have selected
Basin for the countries presented in this report currently
10 countries from the Caribbean Basin, namely Costa Rica,
amounts to approximately 27GW. Renewable energies
Cuba, Dominican Republic, El Salvador, Guatemala,
(including hydro) represent over 30% of the total installed
Honduras, Jamaica, Nicaragua, Panama and Trinidad &
capacity. Between 2010 and 2015 over 3GW of new capacity
Tobago that form the basis of our analysis and the index.
from renewable energies were installed in the Caribbean Basin.
OVERVIEW OF GENERATION CAPACITY BY TYPE
IN THE CARIBBEAN BASIN – 2015
Coal
Fossil fuels
1%
22%
INSTALLED RENEWABLE ENERGY CAPACITY
IN THE CARIBBEAN BASIN – 2010-2015 (IN GW)
Oil
30%
6.1
Gas
27GW
13%
6.8
7.4
7.6
2012
2013
9.2
8.3
Wind
4%
Renewable
energies
1%
Geothermal
Biomass
3%
4%
Hydro
24%
2010
2011
2014
2015
OVERVIEW OF GENERATION CAPACITY BY SELECTED COUNTRY – 2015
GUATEMALA
Oil
49%
Gas
2%
Geothermal
2%
Biomass
17%
2GW
Hydro
37%
3GW
Wind
2%
CUBA
Wind
10%
Hydro
36%
Coal
8%
Gas
19%
Hydro
16%
6GW
Oil
56%
4GW
Fossil
flues
96%
HONDURAS
Oil
43%
DOMINICAN REPUBLIC
Renewable
energies
4%
Coal
2%
Wind
2%
Geothermal
11%
EL SALVADOR
Biomass
14%
Hydro
29%
NICARAGUA
Oil
45%
Geothermal
12%
2GW
Biomass
10%
JAMAICA
1GW
Hydro
10%
1GW
Wind
14%
COSTA RICA
Oil
54%
Oil
20%
Geothermal
7%
Biomass
1%
Hydro
65%
Gas
31%
3GW
Wind
7%
Hydro
57%
PANAMA
3GW
Hydro
3%
Oil
1%
TRINIDAD
& TOBAGO
Oil
34%
2GW
Wind
9%
NOTE: 1 No detailed breakdown for Cuba available (only split into “fossil
fuels” and “renewable energies”
SOURCE:
page 5
Oil
66%
Gas
99%
Bloomberg New Energy Finance
COUNTRY SNAPSHOT: COSTA RICA
KEY FACTS (2015)
KEY ENERGY FACTS (2015)
POPULATION
4.8 million
ACCESS TO ELECTRICITY
GDP (NOMINAL)
US$54.1bn
INSTALLED CAPACITY
3GW
3.2%
ENERGY GENERATION
10TWh
GDP GROWTH (3-YEAR AVERAGE)
FOREIGN DIRECT INVESTMENT
COUNTRY RISK PREMIUM
US$2.9bn
3.55%
MOODY’S RATING
Ba1
POLITICAL STABILITY INDEX
0.58
EASE OF DOING BUSINESS
Profile
100% (2014)
RENEWABLE ENERGY SHARE
99%
RENEWABLE ENERGY TARGET 100% by 2021
EST. EXPECTED EQUITY RETURN
12%
62
AVERAGE ANNUAL POWER PRICES – INDUSTRIAL SECTOR
Costa Rica is one of Central America’s success stories. Its GDP
US$/MWh
per capita of US$10,630, is one of the highest in the region.
200
Thanks to a stable democracy and steady economic growth,
150
Costa Rica is one of the most attractive countries in which to
100
invest. In 2015, the World Bank has ranked it as the number
50
one country in which to do business in the region. This
helped foreign investments reach US$2.8 billion, the second
165
143
136
2011
2012
2013
153
142
2014
2015
highest rate in the region after Panama. It boasts a stable
economy and attracts a solid amount of foreign direct
INSTALLED GENERATION CAPACITY (2015)
investment, thanks in part to its first place ranking in terms of
ease of doing business.
Geothermal
Oil
7%
20%
Biomass
Renewable Energy Policies
1%
With a target to have a 100% renewable energy matrix by
65%
first carbon-neutral economy by 2021
Wind
3GW
Hydro
2030, Costa Rica has committed to becoming the world’s
7%
The electricity market is controlled by Instituto
Costarricense de Electricidad (“ICE”), a vertically integrated,
state-owned utility
CUMULATIVE RE INVESTMENT – LAST 5 YEARS (US$MM)
The generation market is open to private Independent
Hydro
Power Producers (“IPPs”), however the majority of the
Wind
Solar
generation is still in the hands of Compañia Nacional de
Fuerza y Luz (“CNFL”), a subsidiary of ICE
The country offers exemptions on import, value added and
236
512
Geothermal
1.311
1.311
2014
2015
757
income tax for selected renewable energy materials and
2011
equipment
2012
2013
Note: Based on “new build renewable asset finance”, no data available for 2015.
ICE periodically holds tenders to contract new clean energy
SOURCES: Bloomberg New Energy Finance, World Bank, Damodaran,
UNCTAD, IEA
capacity from private generators via auction mechanism
page 6
COUNTRY SNAPSHOT: CUBA
KEY FACTS (2015)
KEY ENERGY FACTS (2015)
POPULATION
11.4 million
GDP (NOMINAL, 2013)
ACCESS TO ELECTRICITY
98% (2014)
US$77.2bn
INSTALLED CAPACITY
6GW
GDP GROWTH (3-YEAR AVERAGE)
n/a
ENERGY GENERATION
n/a
FOREIGN DIRECT INVESTMENT
n/a
RENEWABLE ENERGY SHARE
4%
COUNTRY RISK PREMIUM
MOODY’S RATING
Caa2
POLITICAL STABILITY INDEX
EASE OF DOING BUSINESS
Profile
12.80%
RENEWABLE ENERGY TARGET
EST. EXPECTED EQUITY RETURN
24% by 2030
18%
0.58
n/a
AVERAGE ANNUAL POWER PRICES – INDUSTRIAL SECTOR
Like many of its Caribbean neighbors, Cuba is highly
n/a
dependent on fossil fuels to cover its energy needs. Under
PetroCaribe, the island has been receiving 90,000 barrels of
oil per day from Venezuela. However, with Venezuela on the
INSTALLED GENERATION CAPACITY (2015)
brink of collapse, fuel shipments have become scarcer and
more unpredictable. Cuba’s alternative contemplates
becoming more energy independent by developing
Fossil
fuels
Renewable
energies
96%
4%
renewable energy on an island that is considered to have
significant potential.
6GW
Renewable Energy Policies
In 2014, the Ministry of Energy and Mines signed a
Renewable Energy Development Plan with the target of
increasing renewable installed capacity to 2,100 MW by
2030, which would cover 24% of the electricity generation
CUMULATIVE RE INVESTMENT – LAST 5 YEARS (US$MM)
Currently, only 4% of electricity production comes from
n/a
renewable sources
To reach those goals, however, the government must seek an
SOURCES: Bloomberg New Energy Finance, World Bank, Damodaran,
UNCTAD, IEA
estimated US$3.5 billion in renewable energy investment
mostly in wind, solar and biomass from sugar cane
Attracted by the island’s potential, some companies have
expressed interest in investing in the island. U.K. company
Hive Energy has already committed to build a 50 MW solar
project near Havana
However, despite some recent economic opening, Cuba is
still far from being business-friendly
page 7
COUNTRY SNAPSHOT: DOMINICAN REPUBLIC
KEY FACTS (2015)
KEY ENERGY FACTS (2015)
POPULATION
10.5 million
GDP (NOMINAL)
GDP GROWTH (3-YEAR AVERAGE)
FOREIGN DIRECT INVESTMENT
COUNTRY RISK PREMIUM
97% (2014)
US$68.1bn
INSTALLED CAPACITY
4GW
6.4%
ENERGY GENERATION
14TWh
US$2.2bn
6.40%
MOODY’S RATING
B1
POLITICAL STABILITY INDEX
0.17
EASE OF DOING BUSINESS
103
Profile
ACCESS TO ELECTRICITY
RENEWABLE ENERGY SHARE
RENEWABLE ENERGY TARGET
9%
25% by 2020
EST. EXPECTED EQUITY RETURN
16%
AVERAGE ANNUAL POWER PRICES – INDUSTRIAL SECTOR
The Dominican Republic is the largest economy in the Caribbean, with
US$/MWh
a US$68.1 billion GDP. It has one of the fastest, most diverse economies
250
in the region, having showcased a GDP growth of 7% in 2014 and 2015,
200
the highest in the region. In 2015, it attracted over US$2.2 billion in FDI.
150
Like most Caribbean countries, it is highly dependent on imported
100
142
219
188
186
156
50
fossil fuels and gas for its energy needs (over 80%). In 2011, the country
spent 8.6% of its GDP, an equivalent of US$5.2 billion, on oil imports.
2011
2012
2013
2014
2015
Current consumption is estimated at 145,000 barrels per day, which
would amount to US$10 million daily. The island buys most of its oil
INSTALLED GENERATION CAPACITY (2015)
from Venezuela under Petrocaribe’s preferential rates, but, with
Venezuela facing a slew of political and economic challenges,
alternative arrangements must be contemplated.
Coal
8%
Gas
19%
Renewable Energy Policies
Hydro
16%
The country has set a target to get to 25% from renewable energy
Oil
56%
4GW
sources by 2020 (including hydro)
Wind
2%
Generation is generally open to private companies, but the market
is still dominated by state-owned players
CUMULATIVE RE INVESTMENT – LAST 5 YEARS (US$MM)
In 2004, the government published the Plan Energético Nacional
(“PEN”), which defines energy policies in the country until 2015
Wind
Solar
Biomass
Since May 2007, an incentive regime for the development of clean
energy sources is in place which includes an investment tax credit;
359
external financing tax reductions; exemption from tax on transfer
412
524
633
53
of industrialized goods and services; and import duty exemption.
Renewable energy generators have dispatch priority and open
2011
access to transmission and distribution
2012
2013
2014
2015
Note: Based on “new build renewable asset finance”.
No auctions have been held in the country so far
SOURCES: Bloomberg New Energy Finance, World Bank, Damodaran,
UNCTAD, IEA
Low creditworthiness of state-owned distribution companies is a
significant barriers to investment
page 8
COUNTRY SNAPSHOT: EL SALVADOR
KEY FACTS (2015)
KEY ENERGY FACTS (2015)
POPULATION
6.1 million
ACCESS TO ELECTRICITY
GDP (NOMINAL)
US$25.9bn
INSTALLED CAPACITY
2GW
2.1%
ENERGY GENERATION
6TWh
GDP GROWTH (3-YEAR AVERAGE)
FOREIGN DIRECT INVESTMENT
COUNTRY RISK PREMIUM
US$0.4bn
9.25%
MOODY’S RATING
Ba3
POLITICAL STABILITY INDEX
-0.05
EASE OF DOING BUSINESS
Profile
RENEWABLE ENERGY SHARE
94% (2014)
56%
(incl. hydro)
RENEWABLE ENERGY TARGET
n/a
EST. EXPECTED EQUITY RETURN
14%
95
AVERAGE ANNUAL POWER PRICES – INDUSTRIAL SECTOR
In 2015, El Salvador registered one of the lowest economic
US$/MWh
growth rates while also having one of the lowest GDP per
250
capita from the countries analyzed in this report. Both foreign
200
direct investment and investment in renewables are low.
150
160
178
174
2012
2013
208
153
100
Despite low investment, its renewable energy production and
50
capacity are promising, thanks mostly to public funding, and
so is its energy renewable share, even though the government
2011
2014
2015
has so far failed to establish renewable sources targets. With a
population of 6.1 million, the government estimates energy
INSTALLED GENERATION CAPACITY (2015)
demand will keep growing at a rate of 4.7% per year. Thus, in
a country where 100% of the oil is imported, diversifying the
Geothermal
12%
energy matrix by promoting renewable energy has become a
priority. With that purpose in mind, the Centro Nacional de
Energia (“CNE”), was created in 2007.
Biomass
14%
Renewable Energy Policies
El Salvador aims to diversify its energy mix and reduce its oil
Oil
2GW
45%
Hydro
dependency by adding more renewable capacity
29%
While most of the electricity from clean energy currently comes from
CUMULATIVE RE INVESTMENT – LAST 5 YEARS (US$MM)
hydroelectric power and geothermal, the government is seeking to
attract investment to boost solar and wind energy by opening up
Solar
the market and launching tenders for renewable energy projects
Biomass
333
The power market has been unbundled and generation is
251
251
2013
2014
open to private players
27
27
2011
2012
The first auction took place in 2014, and contracted 94MW of
solar PV capacity. Capacity was contracted at a $116.2/MWh
average price under 20-year power purchase agreements
2015
Note: Based on “new build renewable asset finance”.
In early 2016, a bidding process for a second renewable energy
SOURCES: Bloomberg New Energy Finance, World Bank, Damodaran,
UNCTAD, IEA
tender was launched for 150MW of wind and solar PV projects
page 9
COUNTRY SNAPSHOT: GUATEMALA
KEY FACTS (2015)
KEY ENERGY FACTS (2015)
POPULATION
16.3 million
GDP (NOMINAL)
GDP GROWTH (3-YEAR AVERAGE)
FOREIGN DIRECT INVESTMENT
COUNTRY RISK PREMIUM
INSTALLED CAPACITY
3GW
4.0%
ENERGY GENERATION
10TWh
US$1.2bn
Ba1
POLITICAL STABILITY INDEX
-0.65
EASE OF DOING BUSINESS
Profile
90% (2014)
US$63.8bn
3.55%
MOODY’S RATING
ACCESS TO ELECTRICITY
RENEWABLE ENERGY SHARE
53%
(incl. hydro)
RENEWABLE ENERGY TARGET
80% by 2030
EST. EXPECTED EQUITY RETURN
14%
88
AVERAGE ANNUAL POWER PRICES – INDUSTRIAL SECTOR
With a GDP of US$63.8 billion and a population of over 16
US$/MWh
million, Guatemala is the largest economy in Central
250
America. The Guatemalan economy has shown steady
200
growth over the past two decades and last year posted a 4.1%
150
growth rate, one of the highest growth rates in the Central
100
204
188
197
2011
2012
200
152
50
American region. The government has taken important steps
to attract foreign direct investment (US$1.2 billion in 2015) by
2013
2014
2015
introducing tax reforms and signing free trade agreements.
Guatemala is the second largest Central American power
INSTALLED GENERATION CAPACITY (2015)
market, with a total generating capacity of 3GW. In 2015, it
generated 10.3TWh of electricity.
Geothermal
2%
Renewable Energy Policies
Biomass
17%
The government has implemented different measures in an
effort to attract investment to develop clean sources of
energy
Oil
3GW
43%
Hydro
36%
Wind
Since 2010 it has held periodical renewable energy auctions
2%
that have been able to attract considerable investment
CUMULATIVE RE INVESTMENT – LAST 5 YEARS (US$MM)
The country also offers tax incentives to clean energy
projects, such incentives include fiscal incentives for
renewable projects and exempts generators from import
Hydro
Wind
Solar
equipment value added and net income taxes for 10 years
Biomass
907
The power market in Guatemala is unbundled, with both
state and private players acting in generation, transmission,
0
energy trading and distribution segments
2011
104
2012
995
250
2013
2014
2015
Note: Based on “new build renewable asset finance”.
SOURCES: Bloomberg New Energy Finance, World Bank, Damodaran,
UNCTAD, IEA
page 10
COUNTRY SNAPSHOT: HONDURAS
KEY FACTS (2015)
KEY ENERGY FACTS (2015)
POPULATION
8.1 million
ACCESS TO ELECTRICITY
GDP (NOMINAL)
US$20.4bn
INSTALLED CAPACITY
2GW
3.2%
ENERGY GENERATION
8TWh
GDP GROWTH (3-YEAR AVERAGE)
FOREIGN DIRECT INVESTMENT
COUNTRY RISK PREMIUM
US$1.2bn
7.82%
MOODY’S RATING
B2
POLITICAL STABILITY INDEX
EASE OF DOING BUSINESS
Profile
-0.51
89% (2014)
RENEWABLE ENERGY SHARE
41%
(incl. hydro)
RENEWABLE ENERGY TARGET
60% by 2022
EST. EXPECTED EQUITY RETURN
14%
105
AVERAGE ANNUAL POWER PRICES – INDUSTRIAL SECTOR
Honduras has one of the lowest GDPs per capita in the Central
US$/MWh
American region and as much as 60% of its population lives in
250
poverty. However, the country has shown steady economic
200
growth over the past few years, reporting 3.6% GDP growth in
150
205
232
210
193
156
100
2015. FDI is strong, with US$1.2 billion invested in 2015, the same
50
as Guatemala, a much bigger economy, despite the fact the
country does not rank well on the World Bank’s Ease of Doing
2011
2012
2013
2014
2015
Business report. Honduras has one of the lowest electrification
rates in the region. An average of 11% of the population still lacks
INSTALLED GENERATION CAPACITY (2015)
access to electricity, but that number can be as high as 50% or
more in rural areas. One of the challenges the government faces
Gas
Oil
is expanding infrastructure to make electricity available to rural
2%
49%
populations while managing electricity prices in a country highly
Coal
dependent on imported fossil fuels.
2%
2GW
Renewable Energy Policies
As a result of a feed-in tariff (“FiT”), Honduras has emerged as
Hydro
37%
Wind
10%
Central America’s solar success story
CUMULATIVE RE INVESTMENT – LAST 5 YEARS (US$MM)
A feed-in tariff scheme offered contracts of $180/MWh for the
first 300MW of PV commissioned before July 2015. Projects
commissioned after that date received $150/MWh
Hydro
Wind
Solar
Biomass
1.713
As a result, the country has overtaken Mexico as Latin America’s
1.223
second-largest solar market after Chile
The power market has been controlled by state-owned utility
154
Empresa Nacional de Energia Eléctrica (“ENEE”), but the
country has approved a new electricity law that entered into
force in July 2014, which will allow greater participation of
2011
197
2012
462
2013
2014
2015
Note: Based on “new build renewable asset finance”.
private players in the power market
Honduras also uses auctions to contract new power capacity
SOURCES: Bloomberg New Energy Finance, World Bank, Damodaran,
UNCTAD, IEA, Climate Investment Fund, GTM Research
page 11
COUNTRY SNAPSHOT: JAMAICA
KEY FACTS (2015)
KEY ENERGY FACTS (2015)
POPULATION
2.7 million
ACCESS TO ELECTRICITY
GDP( NOMINAL)
US$14.0bn
INSTALLED CAPACITY
1GW
0.9%
ENERGY GENERATION
4TWh
GDP GROWTH (3-YEAR AVERAGE)
FOREIGN DIRECT INVESTMENT
COUNTRY RISK PREMIUM
US$0.8bn
14.1%
MOODY’S RATING
Caa2
POLITICAL STABILITY INDEX
RENEWABLE ENERGY SHARE
RENEWABLE ENERGY TARGET
6%
20% by 2030
EST. EXPECTED EQUITY RETURN
16%
0.09
EASE OF DOING BUSINESS
Profile
93% (2014)
67
AVERAGE ANNUAL POWER PRICES – INDUSTRIAL SECTOR
Jamaica is the most populated English-speaking country in the
US$/MWh
363
400
Caribbean, with 2.2 million people. With a GDP of US$14 billion
and a GDP per capita of US$5,138, Jamaica is one of the slowest
300
growing economies in the region, with a growth rate of just 0.9%
200
in 2015. For the past 30 years, the country has grown at a pace of
100
about 1% per year. However, thanks to a reform package and a
series of loans from multilateral financing organizations, the
310
287
196
n/a
2011
2012
2013
2014
2015
World Bank projects GDP will grow 1.7% in 2016 and over 2% in
2017. Like its Caribbean neighbors, Jamaica has no oil reserves
INSTALLED GENERATION CAPACITY (2015)
and depends almost entirely on oil imports. As much as 90% of
its energy needs are covered by imported fossil fuels.
Gas
31%
Renewable Energy Policies
Oil
1GW
Oil dependency and the high cost of electricity have hindered
growth and development. To reverse the situation, the government
is focused on developing gas and clean energy projects
66%
Hydro
3%
It was the Caribbean’s first country to hold clean energy-only
auctions. In 2009, the Ministry of Energy and Mining released the
CUMULATIVE RE INVESTMENT – LAST 5 YEARS (US$MM)
National Energy Policy 2009-2030, a plan that promotes the
Wind
development of renewables, supports energy efficiency and sets a
Solar
regulatory framework
186
Private utility Jamaica Public Service (“JPS”) is in charge of
generation, transmission and distribution in the island (the
government owns 20% of the company). Other players may enter the
market as independent power producers and sell electricity to JPS
Jamaica has held two renewable energy auctions to date. Five
projects have been awarded contracts from the auctions totaling
0
0
0
2011
2012
2013
3
2014
2015
Note: Based on “new build renewable asset finance”.
87MW from small hydro, solar and wind plants. The latest, in 2013,
aimed to contract 115MW
SOURCES: Bloomberg New Energy Finance, World Bank, Damodaran,
UNCTAD, IEA
page 12
COUNTRY SNAPSHOT: NICARAGUA
KEY FACTS (2015)
KEY ENERGY FACTS (2015)
POPULATION
6.1 million
ACCESS TO ELECTRICITY
GDP (NOMINAL)
US$12.7bn
INSTALLED CAPACITY
1GW
4.7%
ENERGY GENERATION
5TWh
GDP GROWTH (3-YEAR AVERAGE)
FOREIGN DIRECT INVESTMENT
COUNTRY RISK PREMIUM
US$0.8bn
7.82%
MOODY’S RATING
B2
POLITICAL STABILITY INDEX
EASE OF DOING BUSINESS
Profile
-0.03
76% (2014)
RENEWABLE ENERGY SHARE
50%
(incl. hydro)
RENEWABLE ENERGY TARGET
91% by 2027
EST. EXPECTED EQUITY RETURN
14%
127
AVERAGE ANNUAL POWER PRICES – INDUSTRIAL SECTOR
With a GDP per capita of just US$2,087, Nicaragua is the poorest
US$/MWh
country in Central America. Economic development has been
250
hampered by decades of civil war and political instability.
200
However, the country has showed impressive growth over the
150
past few years and it showcases one of the highest GDP growth
100
228
227
227
219
2011
2012
2013
2014
189
50
rates in Latin America, at 4.9% in 2015. Thanks to the adoption of
policies that have promoted macroeconomic stability, the
2015
country seems to be on the right path. Rich in natural resources,
including rivers, volcanoes, wind and tropical sun, Nicaragua has
INSTALLED GENERATION CAPACITY (2015)
been labelled a “renewable energy paradise.”
Geothermal
Renewable Energy Policies
Nicaragua has set a non-binding 91% renewable energy
generation target by 2027
Incentives include tax breaks, including import duty, VAT and
11%
Biomass
10%
Oil
54%
1GW
Hydro
10%
income tax exemptions
Wind
Distributors must allocate a percentage to renewable power in
14%
tenders for electricity
CUMULATIVE RE INVESTMENT – LAST 5 YEARS (US$MM)
Electricity generation can be contracted through bilateral
contracts between generators and distributors and/or large
Hydro
Wind
Solar
consumers. The Instituto Nicaragüense de Energía (“INE”)
regulates transmission and distribution with tariffs, while
338
generators can compete freely in the market
Biomass
640
640
2014
2015
459
149
Nicaragua holds auctions giving the following sectors priority:
biomass, geothermal, hydro, wind and solar. INE is responsible
for defining the percentage allocated for renewables in tenders
Generators that do not have contracts with distributors or large
consumers may sell their power in the spot market
2011
2012
2013
Note: Based on “new build renewable asset finance”, no data available for 2015.
SOURCES: Bloomberg New Energy Finance, World Bank, Damodaran,
UNCTAD, IEA, Climate Investment Fund
page 13
COUNTRY SNAPSHOT: PANAMA
KEY FACTS (2015)
KEY ENERGY FACTS (2015)
POPULATION
3.9 million
ACCESS TO ELECTRICITY
GDP (NOMINAL)
US$52.1bn
INSTALLED CAPACITY
3GW
6.8%
ENERGY GENERATION
10TWh
GDP GROWTH (3-YEAR AVERAGE)
FOREIGN DIRECT INVESTMENT
COUNTRY RISK PREMIUM
US$5.0bn
2.71%
MOODY’S RATING
Baa2
POLITICAL STABILITY INDEX
0.41
EASE OF DOING BUSINESS
Profile
91% (2014)
RENEWABLE ENERGY SHARE
68%
(incl. hydro)
RENEWABLE ENERGY TARGET
15% by 2030
EST. EXPECTED EQUITY RETURN
12%
70
AVERAGE ANNUAL POWER PRICES – INDUSTRIAL SECTOR
Panama is the second largest economy in Central America
US$/MWh
after Guatemala and, with a population of less than 4 million
250
people, reports the highest GDP per capita of US$13,268.
200
Foreign investment has poured into the country over the past
150
few years, fueled by large infrastructure projects such as the
100
160
169
2011
2012
200
211
2014
2015
123
50
expansion of the Panama Canal. In 2015 alone, the country
received US$5 billion in foreign direct investment, almost
2013
double that which second place Costa Rica received. As a
result, Panama´s GDP grew by 5.8% last year, the highest
growth in the region.
INSTALLED GENERATION CAPACITY (2015)
Renewable Energy Policies
Oil
Panama has adopted auctions to contract renewable
capacity. Utility regulator Autoridad Nacional de los
57%
Servicios Publicos (“ASEP”) sets tender guidelines and
34%
3GW
Hydro
ETESA conducts the auction
Wind
9%
The first wind auction was held in 2011, awarding contracts
for 158MW of projects and a second followed in 2013
awarding a total capacity of 125MW, which is scheduled to
CUMULATIVE RE INVESTMENT – LAST 5 YEARS (US$MM)
be online by 2019
Hydro
Wind
Solar
Biomass
Wind energy shows one of the highest potentials in the
region and receives exclusive incentives, such as accelerated
948
depreciation for relevant equipment and a 15-year tax
exemption for Panama-based companies manufacturing
152
wind equipment
2011
In April 2016, the government of Panama submitted its
Nationally Determined Contributions (“NDC”) to the United
2012
499
2013
2014
2015
Note: Based on “new build renewable asset finance”.
Nations. The NDC establishes a renewable energy non-hydro
generation target of 15% for 2030 and 30% for 2050
327
1.029
SOURCES: Bloomberg New Energy Finance, World Bank, Damodaran,
UNCTAD, IEA
page 14
COUNTRY SNAPSHOT: TRINIDAD & TOBAGO
KEY FACTS (2015)
KEY ENERGY FACTS (2015)
POPULATION
1.4 million
ACCESS TO ELECTRICITY
GDP (NOMINAL)
US$24.6bn
INSTALLED CAPACITY
2GW
-0.2%
ENERGY GENERATION
10TWh
GDP GROWTH (3-YEAR AVERAGE)
FOREIGN DIRECT INVESTMENT
COUNTRY RISK PREMIUM
US$1.6bn
3.13%
MOODY’S RATING
Baa2
POLITICAL STABILITY INDEX
RENEWABLE ENERGY SHARE
RENEWABLE ENERGY TARGET
0%
10% by 2021
EST. EXPECTED EQUITY RETURN
12%
0.27
EASE OF DOING BUSINESS
Profile
97% (2014)
96
AVERAGE ANNUAL POWER PRICES – INDUSTRIAL SECTOR
Trinidad & Tobago is one of the richest countries in the
US$/MWh
Caribbean. With a population of 1.4 million, it has a GDP of
60
US$27.8bn and one of the highest GDP per capita in Latin
50
50
50
50
40
America and the Caribbean at over US$20,000. Contrary to its
neighbors, Trinidad & Tobago has abundant oil and natural
26
20
gas reserves, and is in fact an exporter of both resources. Its
economy, based on oil and gas production, grew at an
2011
2012
2013
2014
2015
average rate of 8% in the early 2000s. However, due to the
decline of oil and gas prices, growth has slowed down to just
1% in 2015.
INSTALLED GENERATION CAPACITY (2015)
Oil
1%
Renewable Energy Policies
Given its substantial fossil fuel resources, Trinidad & Tobago
has not shown much motivation to develop renewable
energy in the past. Its natural resources are more than
2GW
enough to cover domestic demand, and electricity rates are
Gas
99%
the lowest in the Caribbean
However, the dramatic decline in oil prices have created
economic uncertainty and pushed the government to
reassess its energy policy, setting a target of 10% of power
CUMULATIVE RE INVESTMENT – LAST 5 YEARS (US$MM)
generation coming from renewables by 2021, with a focus
on solar and wind energy
n/a
The most important challenge for the island is the absence
of a regulatory framework that supports the development of
a renewable energy industry. Financial and fiscal incentives
SOURCES: Bloomberg New Energy Finance, World Bank, Damodaran,
UNCTAD, IEA, Energy Chamber of T & T
will also be necessary to foster private investment. In 2011,
the country received $140 million in loans from the IDB to
help the government overcome these and other issues and
make the transition towards cleaner energy
page 15
Methodology
and Index Calculation
METHODOLOGY
In this 1st Edition of Pan American Finance´s Caribbean Basin
Renewable Energy Investment Index, we set out to rank the 10
selected countries in the Caribbean Basin region in terms of
investment potential in renewable energy projects.
We took the E&Y Renewable Energy Country Attractiveness Index as
a guideline for the parameters that form our Renewable Energy
Investment Index for the Caribbean and established the following
ranking categories and underlying key metrics:
1. Macro Parameters:
a. GDP
b. GDP growth
c. Foreign Direct Investment
2. Energy Parameters:
a. Access to electricity
b. Renewable energy share vs. target
c. Installed capacity running on oil
3. Policy Parameters:
a. Five year cumulative renewable energy asset finance
b. Framework for renewable energies in place
4. Investment Parameters:
a. Political Stability Index
b. Ease of Doing Business Index
c. Estimated Cost of Equity/ Return potential
d. Payment risk
e. Country Risk Premium
The ranking for each parameter was performed based on a number
from 1 to 10. The lower the number, the better ranked the country is
in the respective category.
page 16
INDEX CALCULATION – MACRO PARAMETERS
For the creation of the “Macro Parameters Ranking”, nominal GDP data from 2015 and GDP growth (3-year average) data for each
of the selected countries was obtained from the World Bank and then ranked from 1 – being the highest – to 10 – being the lowest
GDP. The same ranking methodology was applied to the amount of Foreign Direct Investment received by each country in 2015 with
data obtained from the United Nations Conference on Trade and Development (“UNCTD”). To calculate the total “Macro Parameters
Ranking” we applied a weighting of 30% for GDP and GDP growth respectively, and a 40% weighting to Foreign Direct Investment.
COUNTRY
GDP
(US$bn)
Ranking
Weighting
GDP
Weighting
GDP
growth
Weighting
Foreign
Direct
Investment
Total
Ranking
Macro
Parameters
Costa Rica
54.1
4
3.2%
5
2.9
2
30.0%
30.0%
40.0%
3.5
Cuba
77.2
1
n/a
9
n/a
10
30.0%
30.0%
40.0%
7.0
Dominican Republic
68.1
2
6.4%
2
2.2
3
30.0%
30.0%
40.0%
2.4
El Salvador
25.9
6
2.1%
7
0.4
9
30.0%
30.0%
40.0%
7.5
Guatemala
63.8
3
4.0%
4
1.2
5
30.0%
30.0%
40.0%
4.1
Honduras
20.4
8
3.2%
6
1.2
5
30.0%
30.0%
40.0%
6.2
Jamaica
14.3
9
0.7%
8
0.8
7
30.0%
30.0%
40.0%
7.9
Nicaragua
12.7
10
4.7%
3
0.8
7
30.0%
30.0%
40.0%
6.7
Panama
52.1
5
6.8%
1
5.0
1
30.0%
30.0%
40.0%
2.2
Trinidad & Tobago
24.6
7
-0.2%
10
1.6
4
30.0%
30.0%
40.0%
6.7
SOURCE:
World Bank
GDP growth Ranking
(3-year
average
in %)
World Bank
Foreign Ranking
Direct
Investment
(US$bn)
UNCTD
page 17
INDEX CALCULATION – ENERGY PARAMETERS
Our “Energy Parameters Ranking” is composed of a ranking in regards to access to electricity – the fewer people having
access to electricity the more investment still needs to be realized –, the current renewable energy share within the total
mix of generation versus the renewable energy target the country has set – the higher the implied required yearly growth
rate the better – as well as the percentage of installed capacity running on oil – the higher the share the more replacement
of capacity needs to be completed and the higher the score. To calculate the total “Energy Parameters Ranking” we applied
a weighting of 40% to Access to Electricity and to the renewable energy share versus target. A 20% weighting was given to
the installed capacity running on oil.
COUNTRY
Access
Ranking
to
Electricity
RE Share vs.
Target (implied
required growth
rate in % p.a.)
Ranking
% of installed
capacity
running
on oil
Ranking
Costa Rica
100%
10
0.2%
9
20.0%
8
Cuba
98%
9
12.7%
3
n/a
5
Dominican Republic
97%
7
22.7%
2
56.0%
2
El Salvador
94%
6
n/a
5
45.0%
5
Guatemala
90%
3
2.8%
7
43.0%
6
Honduras
89%
2
5.6%
5
49.0%
4
Jamaica
93%
5
8.4%
4
66.0%
1
Nicaragua
76%
1
5.1%
6
54.0%
3
Panama
91%
4
1.1%
8
34.0%
7
Trinidad & Tobago
97%
7
100.0%
1
1.0%
9
SOURCE:
COUNTRY
IEA
Bloomberg (BNEF)
Bloomberg (BNEF)
Weighting
Access
to
Electricity
Weighting
Renewable
Energy Share
vs. Target
Weighting
installed
capacity
running on oil
Total
Ranking
Energy
Parameters
Costa Rica
40.0%
40.0%
20.0%
9.2
Cuba
40.0%
40.0%
20.0%
5.8
Dominican Republic
40.0%
40.0%
20.0%
4.0
El Salvador
40.0%
40.0%
20.0%
5.4
Guatemala
40.0%
40.0%
20.0%
5.2
Honduras
40.0%
40.0%
20.0%
3.6
Jamaica
40.0%
40.0%
20.0%
3.8
Nicaragua
40.0%
40.0%
20.0%
3.4
Panama
40.0%
40.0%
20.0%
6.2
Trinidad & Tobago
40.0%
40.0%
20.0%
5.0
page 18
INDEX CALCULATION – POLICY PARAMETERS
Our “Policy Parameter Ranking” takes into account the last five year cumulative renewable energy investment in each
country – the more the better. In addition, we looked at whether each respective country has opened the generation market
to private players and allows for Independent Power Producers (“IPPs”) and whether the market has energy
auctions/tenders in place. Given that the latter two parameters are “soft” parameters, the ranking only considers a “1” score
or a “10” score. We assume a weighting of 50% for the cumulative renewable energy investment and a 25% weighting each
for the parameters that aim at addressing whether the country supports renewable energies in general and has respective
mechanisms in place.
COUNTRY
Costa Rica
5 year
Ranking
Cumulative
RE Investment
(US$m)
IPPs?
Ranking
Energy
auctions
in
place?
Ranking
Weighting Weighting Weighting
5 year
IPPs
Energy
cum. RE
auctions
investment
Total
Ranking
Policy
Parameters
1,311.0
2
yes
1
yes
1
50.0%
25.0%
25.0%
1.5
n/a
10
n/a
10
n/a
10
50.0%
25.0%
25.0%
10.0
Dominican Republic
633.0
6
yes
1
no
10
50.0%
25.0%
25.0%
5.8
El Salvador
333.0
7
yes
1
yes
1
50.0%
25.0%
25.0%
4.0
Guatemala
995.0
4
yes
1
yes
1
50.0%
25.0%
25.0%
2.5
Honduras
1,713.0
1
yes
1
yes
1
50.0%
25.0%
25.0%
1.0
Jamaica
187.0
8
yes
1
yes
1
50.0%
25.0%
25.0%
4.5
Nicaragua
640.0
5
yes
1
no
10
50.0%
25.0%
25.0%
5.3
1,029.0
3
yes
1
yes
1
50.0%
25.0%
25.0%
2.0
n/a
10
no
10
no
10
50.0%
25.0%
25.0%
10.0
Cuba
Panama
Trinidad & Tobago
SOURCE:
Bloomberg (BNEF)
Bloomberg (BNEF)
Bloomberg (BNEF)
page 19
INDEX CALCULATION – INVESTMENT PARAMETERS
The “Investment Parameters Ranking” is composed of a ranking in regards to the Political Stability Index as published by the
World Bank – the higher the score the better (lowest possible score is -2.5, highest possible score is 2.5), the Ease of Doing
Business Index as calculated by the World Bank – the lower the score the better –, as well as an estimated equity return rate
that would be targeted in each country for an investment into a renewable energy project and the estimated payment risk.
In addition, we included the Country Risk Premium from Damodaran for each country. The higher the Country Risk
Premium, the lower the credit rating from Moody’s and therefore the less attractive is the country from a ranking point of
view. For the total “Investment Parameters Ranking”, we gave a 10% weighting each to the Political Stability Index and the
Ease of Doing Business Index, a 20% weighting to the estimated equity return rate, a 40% weighting to the estimated
payment risk and a 20% weighting to the country risk.
COUNTRY
Political Ranking
Stability
Index
Ease
of
Doing
Business
Ranking
Est.
Equity
Return
Ranking
Payment
risk
Ranking
Country
risk
premium
Ranking
Costa Rica
0.58
1
62
1
12%
10
Good
1
3.6%
3
Cuba
0.58
1
n/a
10
18%
1
At Risk
7
12.8%
10
Dominican Republic
0.17
5
103
7
16%
2
Poor
10
6.4%
5
El Salvador
-0.05
8
95
5
14%
4
At Risk
7
9.3%
8
Guatemala
-0.65
10
88
4
14%
4
Good
1
3.6%
3
Honduras
-0.51
9
105
8
14%
4
Poor
10
7.8%
6
Jamaica
0,09
6
67
2
16%
2
Good
1
9.3%
8
Nicaragua
-0,03
7
127
9
14%
4
Average
6
7.8%
6
Panama
0.41
3
70
3
12%
10
Good
1
2.7%
1
Trinidad & Tobago
0.27
4
96
6
12%
10
Good
1
3.1%
2
SOURCE:
COUNTRY
World Bank
World Bank
PAF estimate
PAF estimate
Damodaran
Weighting
Political
Stability
Index
Weighting
Ease
of Doing
Business
Weighting
Est.
Equity
Return
Weighting
Payment
Risk
Weighting
Country
Risk
Total
Ranking
Investment
Parameters
Costa Rica
10.0%
10.0%
20.0%
40.0%
20.0%
3.2
Cuba
10.0%
10.0%
20.0%
40.0%
20.0%
6.1
Dominican Republic
10.0%
10.0%
20.0%
40.0%
20.0%
6.6
El Salvador
10.0%
10.0%
20.0%
40.0%
20.0%
6.5
Guatemala
10.0%
10.0%
20.0%
40.0%
20.0%
3.2
Honduras
10.0%
10.0%
20.0%
40.0%
20.0%
7.7
Jamaica
10.0%
10.0%
20.0%
40.0%
20.0%
3.2
Nicaragua
10.0%
10.0%
20.0%
40.0%
20.0%
6.0
Panama
10.0%
10.0%
20.0%
40.0%
20.0%
3.2
Trinidad & Tobago
10.0%
10.0%
20.0%
40.0%
20.0%
3.8
page 20
INDEX CALCULATION – COUNTRY SUMMARY
By weighing Macro Parameters and Policy Parameters 20% each, and Energy Parameters and Investment Parameters 30%
each, the countries score as follows:
COUNTRY
Total Ranking
Macro
Parameters
Total Ranking
Energy
Parameters
Total Ranking
Investment
Parameters
Total Ranking
Policy
Parameters
Total
Ranking
Costa Rica
3.5
9.2
3.2
1.5
4.7
Cuba
7.0
5.8
6.1
10.0
7.0
Dominican Republic
2.4
4.0
6.6
5.8
4.8
El Salvador
7.5
5.4
6.5
4.0
5.9
Guatemala
4.1
5.2
3.2
2.5
3.8
Honduras
6.2
3.6
7.7
1.0
4.8
Jamaica
7.9
3.8
3.2
4.5
4.6
Nicaragua
6.7
3.4
6.0
5.3
5.2
Panama
2.2
6.2
3.2
2.0
3.7
Trinidad & Tobago
6.7
5.0
3.8
10.0
6.0
page 21
INDEX CALCULATION – CONCLUSION
1. PANAMA ranks 1st in our 1st Edition of the PAF CREI
2. GUATEMALA, ranking 2nd in our CREI Index, has
Index. Its current renewable energy share amounts to
done well in attracting investment in renewable
~68% of generation, of which however 66% is coming
energy which has increased its current renewable
from hydro generation and the remaining 2% from
energy share within the energy generation mix to over
wind generation. In 2014, Panama experienced a
50%. However, GDP per capita is one of the lowest in
prolonged drought which resulted in the government
the region and it ranks 10th in terms of political
announcing its intend to develop non-hydro
stability.
renewable energy sources to diversify its energy mix.
The country intends to have a 15% non-hydro
3. JAMAICA ranks 3rd within our CREI Index. It scores
renewable energy share by
high in regards to Ease of Doing Business and still has
a significant share of installed capacity running on
2030.
oil that requires replacement and therefore
investment.
CUBA
GUATEMALA
HONDURAS
JAMAICA
EL
SALVADOR
DOMINICAN
REPUBLIC
TRINIDAD
& TOBAGO
7. NICARAGUA has the lowest GDP per capita
NICARAGUA
as well as electrification rate in the region and ranks 7th.
In a country burdened by recurrent blackouts, electricity
4. COSTA RICA
ranks 4th, especially
driven by high scores in the
Policy
and
Macro
is becoming accessible to an increasing percentage of the
COSTA
RICA
population, thanks to the growth of renewables. In 2014
about 24% of Nicaraguans still lacked access to
PANAMA
electricity. By expanding the energy grid, the government
Parameters
is hoping to reduce that number to 10% by 2017. With
category. Good macro fundamentals coupled with an
91% by 2027, Nicaragua has one of the most aggressive
abundance of natural resources and political stability
targets for generating electricity from renewable sources.
have attracted almost US$3bn of Foreign Direct
Investment into the country in 2015 and a large amount
8. EL SALVADOR ranks 8th in our CREI index, especially
of renewable energy investment. Costa Rica is on track
driven by comparatively low scores in the Macro
to becoming the world’s first carbon-free country.
Parameters section. Nevertheless, the country has
attracted some investment in renewable energies in the
5. With the 5th place, the DOMINICAN REPUBLIC
last five years and has policy frameworks in place.
ranks within the middle in regards to Macro and Policy
Parameters but has potential to improve in regards to
9. TRINIDAD & TOBAGO ranks 9th in our CREI Index. The
its renewable energy share as well as Investment
country is in very early stages of development in regards to
Parameters, driven by comparatively low last five year
renewable energy. Rich in oil and gas resources, the
cumulative investments into renewable energy
government had shown little interest in developing a clean
projects and its Ease of Doing Business score offset by
energy industry, explaining why there has been no
a comparatively high estimated payment risk.
investment in renewable energy. Pushed by declining oil
prices, the government has recently set a 10% target to
6. HONDURAS ranks number 6th in our CREI Index.
generate electricity from renewable energy sources by 2021.
Honduras has attracted a large amount of renewable
energy investment in the last five years and with
10. Following a decline in oil supplies from Venezuela
US$1.7bn ranks number 1 in this category. On the other
and the recent economic opening, CUBA has only
hand, the Political Stability Index and Ease of Doing
recently begun to turn to foreign investors to boost
business are low and payment risk is high.
renewable energy investment.
page 22
About
Pan American Finance
Pan American Finance was established in 2003 and provides strategic
advice and capital raising services in the Caribbean, Latin and North
America, with particular focus on the Caribbean Basin.
«
Our team has over 100 years of combined
investment banking experience, including in M&A
advisory, in debt advisory and project financing,
in mezzanine and equity capital raising, and in
placement agent services.
»
Since inception, our firm has completed 54 M&A advisory,
US$245 million long-term project debt financing for Polaris
debt financing, mezzanine & equity capital raising,
Energy Nicaragua’s 72 MW San Jacinto Geothermal Power
placement agent, and restructuring transactions with over
Project in Nicaragua in 2010
US$3.1 billion in total transaction value, including US$1.3
Our firm has extensive experience in the power and
billion in renewable energy.
renewable energy sector in the Caribbean Basin and in
Our track record includes for example:
Latin America, working with numerous debt providers
Sale of partners JV interest in Sonnedix Solar to JP Morgan
and equity investors:
Asset Management’s Infrastructure Investments Fund in 2016
• Development finance institutions
Joint venture between Sonnedix Solar and JP Morgan Asset
• Local, regional, and global commercial banks
Management’s Infrastructure Investments Fund; over €300
• Strategic and financial equity investors
million in new equity commitments by the JV partners in 2014
The Pan American Finance team consists of investment
Acquisition, US$100 million bridge financing and US$300
banking professionals with diversified backgrounds and
million long-term project debt financing for InterEnergy
extensive transaction experience in investment banking,
Holding’s 215 MW Penonomé Wind Project in Panama in 2014
private equity, and corporate finance & operations and is
complemented by a prestigious group of highly experienced
Acquisition of certain assets of Conergy, German solar EPC
Senior Advisors.
contractor and solar PV developer, by Kawa Capital
Management in Asia, Europe and the US in 2013
page 23
Pan American Finance has completed 18 transactions for over US$1.9 billion
in the infrastructure sector, including US$1.3 billion in renewable energy
TRANSACTIONS
INFRASTRUCTURE
RENEWABLE ENERGY
GEOGRAPHIES
• M&A
• Energy & Power
• Solar
• Central America
• Restructuring
• Mining
• Wind
• Caribbean
• Project Finance
• Ports & Transportation
• Geothermal
• Andean & South America
• Senior Debt
• Real Estate
• USA & Global
• Subordinated Debt
• Mezzanine & Equity
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Disclaimer and Sources
These materials (the “Report”) have been prepared by PAF
Pan American Finance has primarily used the following
Securities, LLC, an affiliate of Pan American Finance, LLC
sources to prepare the Report:
(together “Pan American Finance”), from information
obtained from publicly available sources, that is believed to
Bloomberg New Energy Finance (“BNEF”) (www.bnef.com):
be accurate and that has not been independently verified by
primarily used for information on generation capacity
Pan American Finance. No representation or warranty,
breakdown per country, average annual power prices,
express or implied, is or will be made, and no responsibility
cumulative renewable energy investments and information
or liability is or will be accepted, by Pan American Finance or
on renewable energy policies in each country
by any of its officers, directors, representatives or agents as
to or in relation to the accuracy or completeness of this
Aswath Damodaran (http://pages.stern.nyu.edu/): used for
Report, errors therein or omissions therefrom, in this or any
information on Country Risk Premium
other written or oral communication, and therefore, any and
all liability is hereby expressly disclaimed.
International Energy Agency (“IEA”) (www.worldenergyoutlook.org):
used for information on access to electricity
This Report is being delivered for informational purposes
only. The recipient agrees not to distribute these materials to
United Nations Conference on Trade and Development
others, in whole or in part (or to photocopy or otherwise
(“UNCTD”) (unctd.org): used for information on Foreign
reproduce these materials) at any time without the prior
Direct Investment inflow
written consent of Pan American Finance.
The World Bank (data.worldbank.org): used for information
on population, GDP, 3-year average GDP growth, Political
Stability Index (score from -2.5 to 2.5) and the Ease of Doing
Business index (ranking, the higher the rank/ lower the score
the better)
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PAN A ME R I C A N F I N A N C E – F I RST E D I T I O N
Central Basin Renewable Energy Investment Index
March 2017
Lead Authors: Ben Moody, President & CEO; Mauricio Borgonovo, Managing Director
Lead Researcher: Sina Guenther, Advisor to Pan American Finance
Note on the selection of countries in this report:
This report focuses exclusively on the following Central American and the Caribbean countries:
Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua, Panama, Dominican Republic,
Jamaica, Trinidad & Tobago and Cuba.
The 1st edition of Pan American Finance´s Caribbean Basin Renewable Energy Investment Index was supported
by information provided/obtained from: World Bank, ECLAC, Worldwatch Institute, Bloomberg New Energy,
IRENA, IEA and Climatescope.
You can contact PanAmerican Finance Team by emailing to: info@panamfinance.com
Members of the media can contact and request further information by emailing: [email protected]
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P A N A M F I N A N C E . C O M