DBS, Maybank, IFC to collaborate on funding Johor-Singapore renewable energy project

[SINGAPORE] DBS, Maybank and the World Bank’s International Finance Corp (IFC) have teamed up to develop a financing structure for a cross-border renewable energy project between Malaysia and Singapore.

The lenders, along with renewable clean energy developer and project sponsor Ditrolic Energy, on Monday (Oct 26) signed a memorandum to establish a financing and bankability framework for the US$6 billion Southern Johor Renewable Energy Corridor (SJREC).

The working group formed under the agreement will identify bankability requirements such as regulatory pathways, offtake and risk allocation, and financing structure. By coming together early, the lenders aim to reduce execution risk, shorten the path to financial close and mobilise private capital.

“With close to 90 per cent of our green energy already seeing capacity booking interest, our focus now is a smooth path to financial close,” said Tham Chee Aun, group CEO of Ditrolic Energy.

“By bringing DBS , IFC and Maybank to the table well ahead of (the final investment decision), and working closely with governments, regulators and offtakers, we hope to set a reference framework for financing future Asean Power Grid projects.”

The SJREC – which is being co-developed by the Johor state government’s investment arm, Permodalan Darul Ta’zim – involves building solar farms and battery storage facilities in Johor.

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The project is expected to be a core pillar of the state’s Green Development Policy 2030, as well as the Johor-Singapore Special Economic Zone master plan.

Ditrolic Energy’s wholly owned subsidiary has already received conditional approval from Singapore’s Energy Market Authority to export up to 600 megawatts of renewable electricity to the city-state.