Burkina Faso gets first green energy project on €29m PPP loan
A sole lender to the project, EAIF is lending Urbasolar SAS, the project’s developer €29 million, representing 80 percent of the total cost of constructing the 30 megawatts (MW) facility.
Burkina Faso is getting its first green energy project thanks to a loan from Emerging Africa Infrastructure Fund (EAIF).
The new €35.40 million large-scale renewable energy plant was announced Monday in London. A sole lender to the project, EAIF is lending Urbasolar SAS, the project’s developer €29 million, representing 80 percent of the total cost of constructing the 30 megawatts (MW) facility. This is the 20th clean energy project for EAIF.
Located some 250 kilometres southeast of the nation’s capital city of Ouagadougou, near the town of Pâ, the new solar energy plant will supply all the electricity it produces to Burkina Faso’s national power utility, La Société National D’électricité Du Burkina Faso (SONABEL).
Paromita Chatterjee, an investment director at EAIF’s managers, Ninety One, has said harnessing Burkina Faso’s sunshine to improve its future prospects will bring many benefits to the country and make an important contribution to fighting global warming.
“This project is a perfect example of how EAIF’s public-private partnership model can have lasting economic, social and environmental impacts while mobilising private capital and enterprise to create new infrastructure,” Chatterjee said.
EAIF has supported 20 renewable energy projects across Africa. It has invested US$350 million of loans to private sector developers, bringing Africa 825MW of clean, renewable energy.
Commenting on the project, Arnaud Mine, president of Urbasolar, and Emmanuel Kaboré, Urbasolar regional head – West Africa, said; “as a European expert in solar power, the Urbasolar group is conscious of its role in developing this energy source in Africa, notably in Burkina Faso, where we already operate. It is Urbasolar’s conviction that the solar power sector offers solutions to numerous economic, environmental and social issues.”
Additionally, the project also includes a number of other measures such as education regarding solar technology, the provision of study grants and a micro-financing programme for local women, as well as support for the healthcare system.
The two Urbasolar officials mentioned that the project is the result of the willingness of the Burkinabé President, Rock Marc Christian Kabore, and the government to increase the country’s energy supply by promoting private investment through public-private partnerships.
Urbasolar will work alongside the government and the national energy utility, SONABEL, to reach the goal of generating 200 MW of energy via solar power plants by 2021.
Burkina Faso has a population of nearly 20 million people. Over 40 percent of people live below the poverty line. The country has one of the world’s lowest rates of electrification. Because of a shortage of installed energy generation capacity, Burkina Faso needs to import electricity from neigbouring states.
Urbanisation, structural changes to the economy, and recent strong gross domestic product (GDP) growth have increased demand for energy. Currently relying mainly on fossil-fuelled power stations, the country has embarked on a programme of attracting private capital and expertise to build renewable energy capacity.
The Urbasolar project is one of the first of the new green energy plants. Around 280MW is expected to be commissioned over the next three years. Urbasolar was selected as the developer following a competitive tender process run by SONABEL. Urbasolar will build and operate the plant and construction is forecast to be completed within 18 months.
Established in France in 2006, Urbasolar has installed over 650 photovoltaic (PV) plants and currently operates solar plants of over 900MW. Urbasolar is provding 20 percent of the project’s capital. It is the majority shareholder in the Pâ facility.
A minority stake is held by Project Production Solaire (PPS). Founded as a specialist renewable energy and energy efficiency business in 2010 by a group of Burkinabé engineers, PPS operates in Burkina Faso as well as Togo, Ivory Coast, and Benin.
In July 2019, Urbasolar was acquired by AXPO, a Swiss utility and Switzerland’s largest producer of renewable energy.