Luxembourg-based Securum Equity Partners plans to start construction of 3,000-hectare solar park in Serbia in 2013

Luxembourg-based Securum Equity Partners has decided to use the energy potential of solar radiation, which is, according to their words, 33% bigger in Serbia than in central Europe, and to start the construction of the world's largest solar park in the south of our country in mid-2013.

The plan is to place the panels with the total installed capacity of 1,000 megawatts (MW) on an area spanning about 3,000 hectares.

Ivan Matejak, country manager of Securum Equity Partners in Serbia, explains for eKapija why this company from Luxembourg has chosen our country as the destination for its solar park that is going to be twice as big as currently the world's largest solar park in California, with the capacity of 500 MW.

- Aside from its very favorable geographic position, which is of great significance since our primary aim is to export electricity, it is also important to mention that the intensity of solar radiation in Serbia is among the highest in Europe. When compared to Germany, the most advanced country in this sector in the world, the potential is almost 40% bigger - says Matejak.

Explaining the company's decision to invest nearly USD 3 billion in our country, Matijak states that the government officials in Serbia have showed the understanding for the presented project, adding that Serbia also possesses the appropriate electricity infrastructure and is well-connected with those in neighboring countries.

- In this initial phase of the project development, we had some preliminary meetings with the management of Elektromreze Srbije (EMS), at which we introduced them to our ideas. Based on the Transfer System Development Plan, connection to the grid, which will be carried out in several phases, is not going to be a problem. Locations will be selected on the basis of the presence of the transfer grids of EMS and their capacity – Matejak from Securum Equity Partners explains.

People at this company also stress that there is no reason to fear the environment pollution or possible negative influence on agriculture, which is a very important field of economy in our country.

- We will not choose any location intended for agricultural activities, and that is our strategic and ethical decision. Survey of potential locations is underway, and we will do the selection according to aforementioned criteria and the criterion of the efficiency of solar radiation.

According to the plans of Securum Equity Partners, implementation of this project should kick off as early as in January 2011. It is estimated that all required permits will be collected until mid-2013 when the construction of the solar park and its connection to the power supply system should commence and be carried out in phases until 2015.

- The whole project will be implemented in coordination with the government agencies and public companies directly involved in the project. A task force will also be formed soon, and it will be comprised of representatives of our company and all sides concerned with the project.

The project is now at its very beginning - Securum Equity Partners and Serbia signed a legally non-binding Framework Agreement on 17 November 2011, thus expressing their readiness to participate in its implementation, while negotiations on concrete details are about to start soon.

The company from Luxembourg points out that they will rely exclusively on local manpower in all phases of the project implementation, as well as that Serbia will make profit from fiscal taxes charged to companies whose formation is necessary in order for the solar park project to be implemented.

- It is for sure that such type of the project puts the Republic of Serbia in the top position on the global energy map. In the future, the size of this investment may spark a series of other foreign investments in the sector of renewable energy sources - says our interlocutor.

International analyses show that the demand for electricity is going to grow in the next decade on the whole territory of Europe, as well as that the needs will mainly have to be satisfied with the electrical energy generated from renewable source of energy. If we know that an obligation of the EU countries is to increase the share of renewable energy sources in their overall consumption to 20% until 2020, the potential for the export of electricity generated in Serbia is huge.

- In such scenario we have to bear in mind the decision of certain EU countries, primarily Germany, to progressively close nuclear plants on their territory - people at Securum Equity Partners explain for eKapija.

However, since it is an investment of a very big value, it was impossible to avoid the question of possible risks, both on the global level and on the level of Serbia.

- Potential risks to foreign investment in Serbia are not much different from those in other countries, not only in the region, but also in western Europe. Numerous macroeconomic imbalances and difficulties arise from the global economic crisis, and they could prevent undisturbed implementation of important investments. In spite of that, investments in the sector of renewable energy sources are still on an upward trend on the global level, primarily owing to their own model of development, as well as to the growing demand for energy - says Matejak.

That trend and the fact that the major share of electrical energy that will be generated here is destined for export will enable the financial self-sustainability of the project, on which Securum Equity Partners counts. Actually, that is the only possible way of operating a solar park with such big capacity when having in mind that the Ministry of Energy of Serbia has limited the incentives for the producers of energy obtained from solar radiation to a total of 5 MW.

- The scope of the project itself actually enables its financial self-sustainability. Namely, the decision on the installation of 1,000 MW creates an economy of scope that immediately reduces the costs of components that will be procured from the leading manufacturers of panels and inverters.

In that way, the average costs of the production of 1 kWh of electricity will be reduced, thus directly affecting the profitability of the very production structure, without using the incentives granted by the state - Matejak explains for our web portal.

The investment project under the official name of Neper Solar Park Incubator – Serbia will be implemented by means of a special financial instrument - Neper Fund, which will be formed, especially for this purpose, by Securum Equity Partners in association with Amicorp Fund Services.

Neper Fund is in its final phase of formation, and it will definitely be in operation until late December 2011.

- It is an open end fund, intended exclusively for professional and institutional investors. The investment plan envisages the minimum annual yield of 15% for investors, over the guaranteed period of 20 years.