140.0 million (USD)

Product Line	IFC Investment (million USD)
Risk Management
Guarantee
Loan	140.0
Equity

* These investment figures are indicative

The Project-level outcome rating is Moderate, with a High likelihood of achievement. The likelihood assessment is positively influenced by (a) the existing commitment to building these assets after the successful outcome of Celsia Colombia's bid in the two latest power auctions in Colombia, (b) traditionally favorable regulatory sector framework; (c) Celsia Colombia's strong experience developing energy infrastructure in Colombia; and (d) the advanced stage of the analysis of technical and E&S risks. The proceeds of the Facility will be used for several diverse corporate needs. Due to limited visibility at this stage regarding the specific use of proceeds, the project-outcomes assessment is based on an estimate of the potential outcomes focused on supporting Celsia Colombia's development of two wind farms that are a high priority in the Company's expansion CAPEX pipeline. These two projects have a total capacity of 359 MW for a combined generation of 1,329 GW per year (P50). Environmental Effects: The Project is expected to partly support the expansion of Celsia Colombia's renewable energy assets, thus contributing to the improvement of the power sector's carbon footprint in Colombia. The GoC has committed to reducing the Country's GHG emissions by 20 percent below business-as-usual in 2030 under the NDCs submitted as part of the Paris Agreement. The thermal generation currently represents 31 percent of Colombia's installed capacity, and the share of CO2 emissions from the power sector accounted for 27 percent of the country's total emissions in 2014. By supporting Celsia Colombia's pipeline development of two wind farms, the Project is expected to increase by 10x the non-hydro renewable energy generation capacity in Colombia by adding 359 MW to the existing 36 MW. IFC anticipates that the Project will contribute to the country's climate mitigation agenda by supporting the displacement, particularly during drought events, of high polluting thermal power sources such as coal and heavy fuel oil, with non-conventional renewable energy (reducing the associated carbon emissions). The two wind farms are expected to reduce GHG emissions by approximately 411,990 tons CO2 per year once fully operational. To measure progress against this outcome, IFC will track reduced CO2 emissions per year. Stakeholder Effects: IFC anticipates that the Project will support the development of NCRE capacity in the Atlantic Coast region in Colombia. The power supply in this region is notoriously unreliable, with power outages of approximately 96 hours per year, one of the highest in the country and well above the 36 hours national average. La Guajira region is particularly exposed to drought and poorly equipped to meet demand through hydroelectric generation. The wind farms will expand electricity generation capacity in the region to improve the quality of electricity service. IFC's financing proceeds could also be used to finance other projects in the Company's renewable energy pipeline. To measure the progress of this outcome, IFC will track Company's wind energy capacity in Colombia

Financial Additionality: The Facility offered by IFC provides the client with a five-year committed line of credit. Unlike commercial lines of credit offered in the Colombian market, the Facility will not require credit analysis of each specific Project or investment that the Company intends to fund and is not subject to yearly renewal procedures. This represents a significant improvement in terms of accessing capital when a need arises, while it reduces the transaction costs of going through approval processes imposed by local commercial banks. This financing structure provides flexibility for the Company to implement its rapid expansion program and take advantage of market opportunities without the need to seek long-term financing in rapidly changing and volatile markets. Over the past twelve months, eleven USD-denominated syndicated loans were provided to corporates in Colombia, with a combined face value of 2.68 billion USD and maturities ranging from one to seven years. Four of these loans were in the Infrastructure sector with a combined face value of 1.79 billion USD and maturities ranging from one to seven years. During the same period, one USD-denominated corporate bond was issued in the Financial Services sector with a face value of 400 million USD and maturity of ten years at a corresponding rating of BB+. Moreover, this revolving facility would be among the first Sustainability Linked facilities in LAC and the first Sustainability Linked revolver facility, whereby IFC is seeking to incentivize the client to contribute to meeting SDG targets. This is an innovative instrument in the market that offers improved credit terms (reduction in the interest rate) to the borrower upon achieving environmental sustainability objectives. Non-Financial Additionality Knowledge Sharing and Capacity Building: IFC is supporting Celsia Colombia to implement its digital transformation program, providing expert support for Celsia Colombia on three key challenges affecting the Company's optimal planning and operation of its network. This advisory engagement aims to help expand the distribution network in the medium term (five-years), identifying possible improvements in processes and forecasting software that will benefit from data sourced by new digital equipment.

Please refer to the related Environmental and Social Review Summary (ESRS) document for this project.

Please refer to the Environmental and Social Action Plan (ESAP) tab in the related Environmental and Social Review Summary (ESRS) document for this project.