FW: Latin American renewable energy projects 'too good to miss' for investors

 

 

 

http://www.powerengineeringint.com/articles/2012/06/latin-american-renewable-energy-projects-too-good-to-miss-for-investors.html

Latin American renewable energy projects 'too good to miss' for investors

22/06/2012

By Kelvin Ross
Deputy Editor

Renewable energy projects in Latin America offer such attractive opportunities that it would be "strange" for any private equity investor in the region to not be involved in the sector, according to a New York financier.

George Osorio, managing partner of New York-based private equity firm Conduit Capital, said: "Latin America comes up with some of the best incentives you've ever seen in this sector. I consider it a model to go after."

He said the reason renewable energy had become a very attractive business was because of the stability of cash flows.

He said that seven years ago he wondered where the returns would come from when investing in Latin American renewable projects, but the decision of companies such as GE and Vestas to target Brazil has changed his opinion.

Osorio told a meeting of the Latin American and Caribbean Council on Renewable Energy that Brazil and Mexico in particular offer inexpensive financing and attractive incentives.

The Brazil market was already mature, he said, and the rest of the region was "beginning".

Osorio explained that the returns for wind projects throughout the region range from 9-15 per cent, allowing private equity firms to sell these assets at an attractive profit.

Other countries in the region which he said offered solid opportunities include Chile and Peru.

Patricia McDougall, managing director of power project finance for Canada's Scotiabank, agreed, saying that Chile is "a market-oriented economy, characterised by a high level of foreign trade. It's open for foreign investment."

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