CIP Funds Major Mexico Solar-Battery Energy Project

Copenhagen Infrastructure Partners (CIP) has achieved a significant financial close and commenced construction on its inaugural Mexican venture, the La Esperanza Solar facility. This substantial undertaking, located in the state of Campeche on the Yucatán Peninsula, marks a pivotal moment for CIP's expansion within Latin America's dynamic energy sector. The project integrates a 420 MWdc solar photovoltaic array with a 150 MW/5-hour (750 MWh) battery energy storage system, positioning it as one of Mexico's largest hybrid renewable energy installations.

The La Esperanza Solar project is designed to bolster the resilience and flexibility of the Yucatán Peninsula's power grid, an area experiencing escalating energy demand. The integrated battery storage component is particularly crucial, offering up to five hours of dispatchable power. This capability is vital for stabilizing the grid, ensuring a consistent supply of clean energy, and mitigating intermittency issues inherent in solar generation. Commercial operations are projected to commence in 2028, following the current construction phase.

Financing for this ambitious project includes approximately USD 510 million in debt facilities, secured from a syndicate of prominent international and regional financial institutions: BNP Paribas, JPMorgan Chase Bank, Natixis CIB, Santander, and Scotiabank. Equity contributions are being provided by the project owners, with CI Growth Markets Fund II leading the investment, complemented by a co-investment from Profuturo, a leading Mexican retirement fund administrator. This diverse financial backing underscores the project's strong market appeal and robust risk profile.

Peter Halmø, Head of Latin America and Managing Director at CIP, emphasized the strategic importance of this development. "This represents a major achievement for our Growth Markets Fund II and our dedicated team," Halmø stated. "Our sustained engagement in Mexico has culminated in this first project commencing construction, a testament to the strength of our team, the project's viability, and the collaborative efforts with our contractors, authorities, and partners. Integrating solar power with battery storage is fundamental to enhancing the Mexican grid's renewable energy capacity, and we are proud to contribute to a more dependable and lower-carbon energy future."

The La Esperanza Solar project has garnered recognition from Mexico's Ministry of Energy (SENER) as a priority initiative under the nation's binding planning framework. Development is proceeding in close alignment with federal government objectives and relevant regulatory bodies. This collaboration highlights a shared commitment to fortifying Mexico's National Electricity System through strategic, long-term infrastructure investments. Furthermore, the project benefits from a long-term Power Purchase Agreement (PPA) with CFE Calificados, the commercial arm of the state-owned utility Comisión Federal de Electricidad (CFE), ensuring revenue certainty.

Ole Kjems Sørensen, Partner at CIP, commented on the broader strategic vision: "La Esperanza Solar perfectly embodies the long-term investment strategy of CIP’s Growth Markets funds, focusing on rapidly expanding economies like Mexico. By developing high-quality energy infrastructure in these markets, we aim to deliver compelling returns for our investors while actively accelerating a cost-effective energy transition." The Mexican renewable energy market, driven by increasing demand and supportive policy frameworks, presents significant opportunities for sophisticated infrastructure investors.