The International Finance Corporation (IFC), a member of the World Bank Group, is considering a proposal to provide $30 million as financing into Vietnam-based T&J Green Energy Company Limited (T&J), according to a disclosure.
The financing package is to support a T&J project, which consists of the construction of an 11.6 MW (gross) waste to energy (WTE) plant located on 4.8 hectares of land in the Thuan Thanh district of Bac Ninh province, Vietnam.
The Project will process up to 350 tons per day (tpd) of municipal solid waste (MSW) generated in Bac Ninh province and up to 150 tpd of non-hazardous industrial solid waste (ISW) generated in factories in northern Vietnam.
The Project will generate income from waste tipping fees and from power sold to the national grid via a 20-year power purchase agreement with Electricity of Vietnam (EVN).
The total project cost is expected to be around $74 million.
The $30 million from IFC includes $15 million from the institution’s own account and up to $15 million from IFC in its capacity as implementing entity of the Finland Blended Finance Climate Program.
IFC said in the disclosure that the main project-level outcomes are the stakeholder impact via the increase in waste treatment capacity that will help reduce health and safety risks in the community, and the environmental impact via the avoidance of greenhouse gas emissions from methane emissions generated by the decomposition of waste in landfills and the generating of renewable power.
“The expected market-level impact is from improved sustainability by supporting the development of one of the first WTE plants in the country,” IFC added.
T&J is a company jointly invested by local company Thuan Thanh Environment JSC (TT) and by JFE Engineering Corporation (JFEE) of Japan.
Established in 2009, TT is a local privately-owned company that operates in Vietnam’s waste treatment sector in the following four sub-segments: solid waste treatment, waste-water treatment, trading and recycling of scrap materials, and associated services including waste collection and transportation, environmental consulting services, and industrial cleaning/hygiene services.
Established in 2003 and a wholly-owned subsidiary of JFE Holdings, JFEE provides construction and operation services for essential infrastructure, including WTE plants, water treatment plants, LNG terminals, natural gas treatment plants, bridges, and ports facilities.
T&J is currently 60% owned by TT and 40% by JFEE. The ownership may be changed to 55% by TT and 45% by JFEE in April 2022 upon a scheduled additional capital injection.
Last month, IFC had proposed a $25 million equity investment in PVI Holdings, the largest non-life insurer in Vietnam.
In July, IFC proposed an investment of up to $100 million in Vietnam-based Orient Commercial Bank and another $40 million to SeABank, a Vietnamese commercial lender.
Earlier, in March, it had extended a senior loan of up to $60 million to Thuan Binh Wind Power Joint Stock Company (TBW), one of the first wind power companies in Vietnam.