Greenalia’s first 135 M€ biomass plant goes into operation

• The renewable energy company has obtained the definitive RAIPREE and requested the REE inscription a month ahead of schedule. In March it began selling energy at the price set by the 2016 auction
• Last Friday 28 February the CNMC published an update of the retribution parameters for the upcoming regulatory period. Said revision amplifies the Ro collection rights from 6599 to 7500 total annual hours
• This parameter update will benefit income generation, it will now be over 37 million euros when the Plant starts operating at maximum capacity during 2021 and it will result in over 17 million euros of EBITDA
• It is the most technologically advanced Plant in Spain and the most important Forestry Biomass Plant in the South of Europe

Greenalia’s first Biomass Plant, located in Curtis-Teixeiro (A Coruña) goes into operation after a 19-month construction phase and ahead of schedule. Greenalia started selling its green electricity 1 March 2020 according to the regulated sales framework obtained in the 2016 auction.

Last Friday 28 February 2020 the TED/171/2020 Order was published in the Official Spanish Gazette (BOE) “by which the standard type retribution parameters were updated for certain renewable energy generating facilities”, said update upgrades the Ro collection rights from 6500 to 7500 total annual hours. This update will increase revenues in 5 million euros and EBITDA in more than 2 million euros.

In the same way, and in relation with Circular 3/2020, published 15 January, of the CNMC, eliminated the generation toll that it applied to energy generation facilities that amounted to 0,5 €/MWh.

Lastly, last 3 December, the CNMC published Circular 4/2019 by which it established the retribution methodology starting January 2020 for the electric grid operator. It established that a 0,13741 €/MWh cost will be applied to all energy generation facilities destined to finance the grid operator and applied to all production that is transferred to the grid.

After a 135 M€ investment, the Curtis Forestry Biomass Plant became the most important one in the South of Europe, one of the two biggest facilities in Spain and the first technology wise.

The go-live of the Plant’s operations will generate 37 M€ in sales and an over 17 M€ EBITDA. In the next 25 years of its estimated lifespan it will generate: (a) a recurring income of above 1050 M€ in energy sales; and (b) 340 M€ in forestry residue supplies for Greenalia Forest (a Group’s subsidiary company forestry residue provider for the Plant).

Manuel García, Greenalia’s CEO, points out that: “(…) with this milestone, Greenalia consolidates itself as an important player in the de-carbonization of Spain, moreover it shows the rigor and professionalism of our company in achieving its business plan (2023) even earlier than forecasted.”

The Biomass Plant (Curtis-Teixeiro) becomes Greenalia’s second renewable energy generation project. The first one being the Miñón Wind Farm that started operations the last quarter of 2019. These two projects, together with the rest of the projected and currently under development wind farms and solar projects, will amount for 1 GW of installed power by 2023.

Protecting the Environment and Creating Local Wealth

The 50 MW Biomass Plant will generate energy that could supply a 250.000 people area and avoid 393.973 tons of CO2 emissions a year.

During the construction phase, it generated more than 1.000 jobs (direct and indirect), 100 of these will be permanent (35 in the Plant and the rest in forestry biomass residue gathering and management).

“The kick-off of operations of our Biomass Plant, confirms the value of these technologies in environmental protection, since it reduces greenhouse gases while also cleaning our woods and reducing the risk of wildfires. Moreover, it consolidates the huge potential that Galicia has in renewable energy as a source of growth for the whole Autonomous Region, helping in population settlement and creation of new job opportunities” the CEO of the listed company added to his statement.

The Facilities

Greenalia’s Biomass Plant incorporates the latest technology applied to biomass energy generation infrastructures in compliance with the highest standards and European strictest regulatory frameworks. The facilities are highly efficient with respects to energy generation and a very reduced level of CO2 emissions. It uses dry refrigeration which means it barely consumes water and does not generate spills.

The plant has the capacity to consume 500.000 tons of forestry residue that will be collected from woods that have an FSC or PEFC certification located within a 100 KM of the Plant.

The Biomass Plant (Curtis-Teixeiro) has been the second project that Greenalia has financed with a Project Finance structure. Greenalia also became the first PYME (Small & Medium Enterprise) to issue a green bond in Europe. Its financing obtained top marks (E1) as green financing by Standard&Poor’s. Additionally, this financing obtained the Best European Biomass Project IJ Global Award in 2018.

Additionally, the company has secured a 28-million-euro bilateral loan for its greenfield projects and it has currently disbursed 18 million of those funds.

This financing tranche will allow the development of those projects until the obtain RTB (ready to build) status.