EBSA, Colombia
– Electricity distribution utility in the Boyacá and Santander provinces in Colombia
Interest: 17%
Description
EBSA is an electricity distribution franchise in the Boyacá and Santander provinces in Colombia, approximately 150 km north of Bogota.
Regulatory Environment
- Established and progressive regulatory environment that provides attractive real return on indexed rate base with a deemed cost of capital framework matching local currency debt financing strategy and providing equity protection for country risk.
Strong Stable Cash Flows
- Consistent history of positive cashflow generation with good utility operating metrics.
Customer Base
- EBSA provides power to a current customer base of 370,000 that is primarily residential with nearly 100% urban electrification and 90% rural electrification. Customer growth and consumption is expected to grow in line with general population and GDP growth.
Growth Opportunities
- The region in which EBSA operates is home to growing cement and steel industries, in particular, and improved road transportation infrastructure linking the region to Bogota. We believe these factors should also improve growth.
- EBSA will benefit from annual tariff increases linked to inflation.
- EBSA owns the distribution franchise rights in Boyacá region, so the company has a first right to pursue organic growth investments which we believe will help grow rate base over time including opportunities in transmission, generation and consolidation of other distribution companies.