Page 8 - AfrElec Week 01

AfrElec RENEWABLES AfrElec
$20mn for private equity investment in solar
AFRICA
THE African Development Bank (AfDB) has approved a $20mn investment in the Metier Sustainable Capital International Fund II, a private equity fund that backs clean energy and resource-efficient infrastructure projects across sub-Saharan Africa.
The bank’s funding will contribute to a pipe- line of 178.5 MW of renewable projects in the off-grid commercial and residential sector. It will also create opportunities for industrial wastewa- ter treatment and waste-to-energy generation.
The fund already has experience in South African grid-connected projects, and now aims to back new off-grid and micro-grid projects in the whole of sub-Saharan Africa.
The Fund will meet the Bank’s strict environ- ment and safeguards standards to ensure poten- tial risks are adequately mitigated.
“Metier has extensive experience in devel- oping and financing renewable energy projects with strong technical partners and co-developers in Southern Africa. We are pleased to join other investors in supporting their expansion into new African markets to help unlock the vast renewa- ble potential of the continent,” said Wale Shoni- bare, the AfDB’s acting vice-president for power, energy, climate change & green growth.
He said the investment was part of the bank’s efforts to alleviate financing constraints in the renewable energy sector.
Metier is a well-established fund manager that has ploughed $550mn into African countries, with solar, wind and hydro projects in Southern and East Africa being a major component.
The new fund is a follow-on fund from Metier’s well-established Lereko Metier Sustain- able Capital Fund (LMSC).
This fund has backed, for example, the Bok- poort concentrated solar power (CSP) plant and the Khobab and Loeriesfontein 2 wind farms in South Africa, all of which are Renewable Energy Independent Power Producer Programme (REIPPP) projects that are connected to the country’s gird.
Marc Immerman, managing principal at Metier Sustainable Capital, said: “We embrace the strong synergies between the mandate of the AfDB and Metier Sustainable Capital Fund II. We look forward to jointly delivering a port- folio of clean energy and resource-efficient investments.”
Metier’s website states that the new fund will deliver social and environmental benefits as well as financial returns.™
AfDB funds solar irrigation in Sudan
SUDAN
THE African Development Bank (AfDB) has approved a $21.8mn grant to the government of Sudan to accelerate the adoption of solar-pow- ered irrigation pumps in the country’s West Kordofan and North Kordofan states.
Using solar power will reduce demand for diesel fuel to drive pumps, thereby doing away with high fuel expenses in vulnerable rural areas and reducing emissions.
The project will allow farmers to use solar technology by installing a total of 1,170 photo- voltaic (PV) irrigation pumps, the AfDB said.
The cash will also fund the creation of sup- porting infrastructure, such as maintenance and repair workshops for the pumps and the con- struction of a pump testing laboratory to provide certification and training.
The AfDB provides grants to stimulate eco- nomic development in rural and vulnerable areas that offer poor investment conditions and high risks for private investors and commercial banks.
Agriculture is an important economic sector in Sudan. In 2016, nearly 40% of the country’s GDP derived from farming. For the sector, and for the wider economy, the project offers signifi- cant and numerous knock-on benefits.
As a result of the expected phasing out of diesel-fuelled pumps, participating farmers will realise cost savings from no longer needing to purchase diesel, which is scarce in rural areas.
Productivity also would increase: diesel gen- erators require time-consuming maintenance and repair. Pollution and greenhouse gas (GHG) emissions from agriculture, the country’s largest contributor, would fall.
Paul Baldeh, the bank’s director for power systems development, noted that “by extend- ing farmers a grant covering 75% of installation costs, the government, with Bank support, will overcome the most significant hurdle [to] adopt- ingcleanPVtechnology:highupfrontcosts.”
The remaining 25% will be payable in install- ments over three years. He added that the pro- ject would conduct a groundwater survey and sustainability assessment that will inform the development of subsequent projects in Sudan.
The project meets the Sudanese government’s renewable energy and poverty reduction objec- tives as well as the bank’s High Five and Energy Sector Policy.
Moreover, the project has strong potential to be replicated and scaled up in other parts of the country.™
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w w w. N E W S B A S E . c o m Week 01 09•January•2020