[Funding] KB Pumps Money into Renewable Energy, Raising 380 Billion KRW for Korea's Largest 'Bigeum Solar Power Project'

Most of the project funding secured
Participation from pension funds, regional banks, insurance companies
Major players emerging in domestic and international renewable energy projects

Bigeumdo

[Asia Economy Reporter Park Soyeon] KB Financial Group has nearly completed raising investment funds for the largest domestic solar power generation project worth approximately 380 billion KRW.

According to the investment banking (IB) industry on the 17th, the financial arrangement for the 'Bigeumju Residents Solar Power Generation Project,' jointly led by KB Kookmin Bank and KB Securities, is expected to be finalized within this month.

An IB industry official stated, "With KB as the arranger, regional banks, insurance companies, and pension funds participated," adding, "Each institution is currently conducting final approvals, and the final agreement is likely to be signed within this month." He also noted, "Recently, each institution needs ESG (Environmental, Social, and Governance) related achievements, and participation was high given that this is the largest domestic solar power project."

The 'Bigeumju Residents Solar Power Generation Project,' initiated since the year before last, is a project to build a 200MW scale solar power plant utilizing salt farm sites in Bigeum-myeon, Shinan-gun, Jeollanam-do. It is a large-scale project approximately twice the size of existing domestic solar power projects, attracting attention from the renewable energy industry.

In particular, as a resident-led eco-friendly project with the Bigeumju Residents Cooperative holding a 40% stake, it also carries the meaning of coexistence. The project was promoted as a consensus was formed on the need to create new sources of income on the salt farm sites due to the decline in salt prices.

Through this project, residents of the Bigeum-myeon salt farms will receive dividend income from equity investment for 20 years. Jeollanam-do, Shinan-gun, Hoban Industries, LS Electric, and Haedong Construction are also participating. Completion is scheduled for the end of 2022.

The shareholder composition is 40% Bigeumju Residents Cooperative, 29.9% Korea Hydro & Nuclear Power, 15.1% Hoban Industries, 12% LS Electric, and 3% Haedong Construction.

Meanwhile, KB, which led the financial arrangement for this project, has been particularly prominent in domestic and international solar power projects among renewable energy power generation businesses.

Last year, KB Kookmin Bank successfully co-arranged project financing worth 840 million USD for a U.S. solar power plant and energy storage system (ESS) project. It participated as a joint arranger alongside global arranging institutions such as Deutsche Bank, BNP Paribas, and ING Bank, and committed an investment of approximately 100 million USD in raising a total syndicated amount of 840 million USD.

In 2020, KB participated as a financial advisor in the 'Solar City Solar Power Generation Project,' which began commercial operation. The Solar City Solar Power Generation Project has a generation capacity of 98MW, making it the largest domestic solar power plant currently in operation. Its energy storage capacity of 306MWh is among the largest in the world.

In the same year, KB Securities participated as a financial investor (FI) in the construction project of a 99MW solar power plant on the Gunsan Saemangeum industrial research site through the 'KB Sprott Renewable 1 Private Equity Fund,' formed with Canadian resource specialist asset manager Sprott, totaling 65 billion KRW.

KB Financial Group plans to expand the scale of ESG products, investments, and loans to 50 trillion KRW by 2030, focusing 25 trillion KRW of that amount on eco-friendly sectors, in addition to solar power projects.

This content was produced with the assistance of AI translation services.