Solarpack issues green Islamic bond to refinance Malaysia solar farm

Solarpack Suria Sungai Petani Sdn Bhd. (3SP), a unit of Spanish developer Solarpack, has raised MYR 285 million (USD 64.3m/EUR 58.6m) through the issuance of green Islamic bonds in Malaysia to refinance a construction loan for its 116-MWp solar plant project in the country.

3SP issued the notes known as ASEAN Green SRI Sukuk Wakalah, which comprised 38 semi-annual tranches with tenors ranging from one year to 19.5 years tailored to match with the cash flow generation from the project, Solarpack said on Tuesday. The firm’s Malaysian unit used the proceeds to refinance a bridge loan it took to fund the construction of the solar farm.

The issuance is in line with the ASEAN Green Bond Standards, the Securities Commission Malaysia’s Sustainable and Responsible Investment Sukuk framework and the International Capital Market Association’s Green Bond Principles. RAM Rating Services Berhad rated the bond AA2/Stable, the Spanish solar power producer said.

3SP, as Solarpack’s project company, was awarded the solar project under Malaysia’s Large-Scale Solar 3 (LSS 3) Scheme in 2019. The award entitled the company to a 21-year power purchase agreement (PPA) with Malaysian utility Tenaga Nasional Berhad (KLSE:TENAGA).

The solar farm achieved commercial operation on March 8, 2022, Solarpack said.

(MYR 1.0 = USD 0.226/EUR 0.206)

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