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Alcazar Energy Is Now In The Process Of Launching A New Fund, AEP-II. Similar To AEP-I, The New Fund Will Invest In Renewable Energy Projects However Across A Wider Region To Include The Middle East and North Africa, Eastern Europe, and Central Asia: Daniel Calderon, Co-Founder & Managing Partner, Alcazar Energy

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DANIEL CALDERON CO-FOUNDER & MANAGING PARTNER, ALCAZAR ENERGY

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In an interesting interview with SolarQuarter Middle East, Daniel Calderon – Co-Founder & Managing Partner, Alcazar Energy gave us his views on the solar sector and investments in the MENA region. He spoke about the pandemic effect on the company’s business and its major projects. He also gave us the company’s growth plans for 2022.

What is your view on the solar sector of the MENA region at the moment?

The Mena solar sector continues to experience strong growth driven by the energy demand growth and the economic and industrial development in the MENA region. It has been repeatedly demonstrated throughout the region the ability of solar power to provide very cost-efficient, indigenous energy to power countries’ economies whether as a means to substitute or complement energy imports or as a means for oil and gas-rich countries to diversify their economies. This continues to fuel the strong regional interest and growth of the sector. Additionally, the various governments’ commitments to renewable energy targets represent an additional driver to solar energy in the MENA region. The aforementioned factors propel the sector growth in both hydrocarbon-rich and non-hydrocarbon-rich countries in the region. We expect the same trend to continue and the solar sector to continue to grow strongly throughout the MENA region supported by the region’s favorable solar power conditions particularly the availability of project land, an abundance of resources, the developed construction industry throughout the region, availability of liquidity and project finance, and the now abundant reference track record of bankable frameworks in the region.

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How is the current scenario of the investment sector in the region? How has it evolved over the years?

The renewable energy investment sector is expected, in line with a historic performance, to maintain a growth scenario. Despite the temporary impact of the Covid pandemic, the same has created a backlog of infrastructure projects in general, including energy projects, which need to be built. As a result, the scenario of the investment sector in the region is of a very positive outlook. Additionally, governments in the MENA region, and particularly in the GCC regions, have enacted several regulations and incentives to support and attract investment at multiple levels further promoting the outlook of investment in the region.

What has been the effect of the Covid pandemic on Alcazar Energy’s business?

Alcazar Energy was fast to roll out safety and health measures at various levels including by local operational teams across the asset base in response to COVID-19. A Projects Preparedness and Response Plan were implemented to minimize the impact of COVID-19 on operations, which included installing on-site thermal cameras, performing tasks remotely, postponing preventive maintenance tasks until curfews were lifted, having local teams working in shifts, etc. This allowed for seamless operations in spite of the COVID-19 outbreak. The minimal impact of COVID-19 on the operational and financial performance of Alcazar Energy’s project portfolio at the time demonstrated its resilience through economic downturns and robustness of the underlying contractual structures put in place for the projects. Additionally, wind and solar projects were considered essential infrastructure during COVID-19 by the host countries and were therefore allowed to operate with limited personnel even at the height of the crisis, which supported the continuity of seamless operations.

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What have been some of the prominent projects Alcazar Energy implemented in 2021?

We are proud of what we have achieved at Alcazar Energy Partners (AEP-I) with the support of our investors, lenders, and local governments over the past seven years. In this short period of time, we have built the MENA region’s leading independent developer and producer of renewable energy. Our power plants have helped develop the renewable energy industry in Jordan and Egypt powering 275,000 households and saving over 15.6m tons of CO2 whilst also making a strong contribution to economic growth and employment, particularly within the local communities. We also drove ca. USD 750m of foreign direct investment to our countries of development supporting local economies and local communities creating in the process over 4,220 jobs (of which 80% were in-country), saving local government over USD 1.3bn in energy costs, and allocating over USD 15m to social investment in host communities.

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What is Alcazar Energy’s growth plan for 2022?

In September 2021, Alcazar Energy completed the successful exit of AEP-I through a highly competitive auction which attracted wide interest and was won by a consortium led by China Three Gorges. Alcazar Energy is now in the process of launching a new fund, AEP-II. Similar to AEP-I, the new fund will invest in renewable energy projects however across a wider region to include the Middle East and North Africa, Eastern Europe, and Central Asia. We are very excited at the wide growth prospects and the opportunity to leverage our
proven platform to build a substantial portfolio of high-quality renewable energy projects which would support the availability of clean and affordable electricity in our host countries while fostering economic growth, FDI inflow, and social development.

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