Access to renewable energy at small and medium scale in Central America

01.09.2009
CASEIF II recently completed its investment in TECNOSOLUCION S.A. (TECNOSOL). The investment’s main purpose is to support the company’s growth strategy in Nicaragua and to start the regional expansion plan in Central America. This project demonstrates how BIO’s investments in private equity funds such as CASEIF II can yield very high development effects by contributing to the expansion of small businesses in the region.

The company was founded in 1998, and since has made over 35,000 installations of solar energy systems in rural areas in Nicaragua. It promotes access to energy for families and productive units in areas where the utility companies can’t offer services. The company also promotes efficiency and energy saving in urban zones by means of promotion and installation of thermal solar systems.

TECNOSOL has installed more than 30,000 energy systems in Nicaragua and has coverage in all the country. Currently, the company’s plans consist in completing the growth stage in Nicaragua and consolidate the operation, with the objective to prepare the basis for the regional expansion in the rest of Central America. The value offer will be similar to the one that has proved to be successful in Nicaragua.

In July 2009, the Millennium Challenge Corporation’s program in El Salvador called on a bid for the installation of 500 solar systems in rural areas of El Salvador. Several Salvadorian firms participated in the bid and so did Tecnosol, in reason that the bid was also open for foreign companies. The offer presented by Tecnosol was the best in several aspects of the evaluation, such as the experience in the sector, the total number of solar systems installed, the price, and the installation period. This will be the first step in the regional expansion plan of Tecnosol.

CASEIF II is a private equity fund of 35 million dollars for growth stage companies in the Central American region. SMEs in the region generally lack access to financing and long term capital, the basis for their growth. CASEIF II is committed to providing long term capital needs to these companies and to playing a demonstration role. It also aims at improving transparency and governance within its investees.

BIO has committed a $ 5 million equity investment in CASEIF II. Other partners include the Multilateral Investment Fund (MIF) of the Inter-American Development Bank (IADB), the Norwegian Investment Fund for Development (Norfund), the Swiss Investment Fund for Emerging Markets (SIFEM), the Finnish Fund for Industrial Cooperation (Finnfund), the Andean Investment Corporation (CAF) and Latin American Financial Services (LAFISE).

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