47232 - GRPO Green Bond

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Summary of Investment Information

Project Number

47232

Company Name

GEORGIAN RENEWABLE POWER OPERATIONS JSC

Date SPI Disclosed

Oct 12, 2022

Country

Georgia

Region

Europe

Projected Board Date

Sep 30, 2022

Environmental Category

B - Limited

Status

Active

Last Updated Date

Oct 14, 2022

Department

Regional Industry INF LAC & EUR

Industry

Infrastructure

Previous Events

Approved : Oct 7, 2022
Signed : Oct 8, 2022
Invested : Oct 12, 2022

Sector

Renewable Energy Holding Companies

Project Description

Georgia Renewable Power Operations JSC (“GRPO”, the “Issuer”), a renewable energy affiliate of Georgia Capital PLC (“GCAP”, the “Sponsor”), being established following GCAP’s strategic decision to separate and demerge its renewable energy business from Georgia Global Utilities JSC (“GGU”) and consolidate operational renewable energy assets, including four hydropower and one wind power plant of total 71 MW installed capacity, under GRPO.

Sponsor / Cost / Location

Product Line	IFC Investment (million USD)
Risk Management
Guarantee
Loan	20.0
Equity

Development Impact

The Project raises financing through a green bond issuance to refinance existing liabilities which were used for redeeming a portion of the US$250 million Eurobond issued in 2020 by GGU. The Project will help GCAP to support GRPO’s core business and new renewable energy investments. The debt refinancing supported by the Project unlocks risk capital from the Sponsor to develop renewable energy projects. The main expected project-level outcomes are the positive environmental effects derived from increasing renewable energy capacity in Georgia and facilitate renewable energy supply to meet growing demand in Georgia. At a market level, the investment increases financial integration of Georgia’s infrastructure corporates to capital markets and contributes to develop domestic capital market through demonstration effects.

IFC’s investment has financial additionality driven by countercyclical financing and resource mobilization. IFC is an anchor investor in GRPO’s debut green bond, which contributes to raise long-term financing during a period of significant risk aversion by investors. IFC’s anchor investment and experience in sustainable finance instruments contributes to a successful subscription of the first green bond issued in Georgia’s domestic capital market and the mobilization of commercial investors.

E&S Category Rationale / Risks and Mitigation

All funds from the bond issuance will be used to refinance existing GRPO’s assets. Bond proceeds will not be used for development or acquisition of any new asset. The GRPO’s operations will be conducted within the existing E&S footprint and thus are expected to have limited E&S risks and impacts associated with the investment, most of which will be related to operation & maintenance activities of existing assets. This investment is therefore classified as Category B because a limited number of adverse E&S impacts may result which can be avoided or mitigated by adhering to generally recognized standards, guidelines, or design criteria.

Beyond the scope of this project, GRPO may acquire or transfer new assets from GRPC to its portfolio. GRPO under its ESMS will provide E&S due diligence of any new asset against national E&S requirements and IFC Performance Standards. The Client is committed to exclude acquisition/transfer of RE projects with high E&S risks (Category A type activities), that may result in: (i) significant involuntary resettlement; (ii) impact on lands to which ethnic minorities/indigenous people maintain collective/ancestral attachment; (iii) significant impacts on biodiversity; (iv) significant impacts on cultural heritage; or (v) significant occupational health and safety risks or significant risk of child labor and forced labor in the supply chain.

Key environmental and social (E&S) risks for this investment include: (i) effectiveness of the Issuer's management systems and capacity to operate in a manner consistent with IFC requirements; (ii) occupational health and safety; (iii) risks related to infrastructure safety, emergency preparedness, and community safety; and (iv) high risk of exposure to natural hazards with high damaging and life-threatening potential, such as floods and landslides; and (v) biodiversity conservation and sufficiency of environmental flow.

Contacts

For Inquiries About the Project, Contact

Georgia Renewable Power Operations JSC
Mariam Kharashvili
Head of Business Development
+995 598 456 422
mkharashvili@grpc.ge
10 Medea (Mzia) Jugheli Street, Tbilisi 0179, Georgia
www.grpc.ge

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Local Access of Project Documentation

Contact Person: Mariam Kharashvili

Issuer Name: Georgia Renewable Power Operations JSC

Address: 10 Medea (Mzia) Jugheli Street, Tbilisi 0179, Georgia

Email: mkharashvili@grpc.ge

Phone: +995 598 456 422

This Summary of Investment Information (SII) is prepared by IFC to disclose a factual summary of the main elements of the potential investment. Its purpose is to enhance the transparency of IFC’s activities. For any project documentation or data included or attached herein, whether prepared by the project sponsor or otherwise, authorization has been given for public release by the project sponsor. IFC considers that this SII is of adequate quality for release to the public, but has not necessarily independently verified all of the project information therein. It is distributed in advance of IFC Board of Directors’ consideration and may be periodically updated thereafter. Board dates are estimates only and this document should not be construed as presuming the outcome of the Board Directors’ decision. The following SII is disclosed in accordance with IFC's Access to Information Policy (AIP) that went into effect on January 1, 2012.

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