Two Brisbane solar companies have struck a deal to develop a 250 megawatt solar station in Indonesia.
Solar Guys International and Mitabu Australia are working with the Indonesian Ministry of Energy on the $550 million project.
In a statement released by a representative for the joint companies, SGI-Mutabu will be participating in an Australian first.
“Funding for the first 50MW of the project will be obtained using local Indonesian and Islamic financing known as a sukuk.”
SGI-Mitabu will begin sharia-compliant financing in July using the offshore-domiciled sukuk, or Islamic bond.
Rusydi Mitabu, director of Mitabu Australia said Indonesians like the idea of clean, green energy.
“Investors are excited about the idea of clean energy and its sustainability features,” he said.
“The demand for the Australian dollar and for non-US dollar dominated sukuk is growing very strong.”
Reuters Newsagency has reported in the past of taxation being a major concern for Australian companies considering Islamic financing.
Many Islamic contracts, including sukuk, attract up to triple tax duties because they require multiple transfers of titles of the underlying asset.
Despite this, Mr Mitabu says the offshore financial structure could appeal to many Australian companies with overseas assets and has already drawn interest from some local government officials.
