The consortium is being led by Norway's Scatec Solar and Dutch developer Gigawatt Global Cooperatief, with additional funding from U.K., U.S., Finnish and Austrian governments.
The East African nation of Rwanda is set to lead the way in breaking new solar PV ground in the region with the announcement this week that construction has begun on a new 8.5 MW solar PV plant in the country.
The project is the result of a global consortium of solar companies, funding institutions and national governments, which between them raised €23.7 million in financing for the plant.
Leading the development is Norwegian solar company Scatec Solar and Gigawatt Global Cooperatief, a solar developer from the Netherlands. These two companies have partnered with Norfund – the Norwegian Investment Fund for Developing Countries; FMO – the Dutch Development Bank; and the Emerging Africa Infrastructure Fund (EAIF). All three entities have provided funding for the project, with additional investment coming via government-led initiatives from the U.K., U.S., Finland and Austria.
The PV plant will become East Africa's first utility-scale solar installation and, once complete, will generate 8% of Rwanda's electricity. The Rwandan government is eager to invest more steadily in renewable energy, and has set itself the objective of a five-fold increase in renewable sources of power by 2017.
The project is located 60 km from the Rwandan capital of Kigali, on land that belongs to the Agahozo-Shalom Youth Village (ASYV) – an educational and residential community created for Rwandan youths orphaned during the country's 1994 genocide. The ASYV is leasing the land, and some of the fees generated will be used to help fund the charity's ongoing activities. It is estimated that once complete, the plant will generate 16 million kWh of clean solar power a year. The Rwanda Energy, Water and Sanitation Authority (EWSA) has signed a 25-year Power Purchase Agreement for the energy it produces. Completion and commercial operation is expected by this summer.
"We are very happy to be able to realize this first utility scale PV project in Rwanda," said Scatec Solar CEO Raymond Carlsen. "At the end of last year, we grid-connected the first utility scale solar park in Southern Africa. The 75 MW Kalkbult solar park is currently the largest on the continent. Our objective has been to bring the experience gained in South Africa to other African nations, and we are pleased to team up with Norfund, FMO and EAIF to introduce large-scale solar energy to East Africa."
Scatec Solar and Norfund will be the plant's majority owners, with Gigawatta Global acting as project developer and retaining a 20% share in the project. Gigawatt Global's CEO, Yosef Abramowitz, remarked that the project is "proof positive" that bringing large-scale solar power to East Africa is feasible. "We believe in power for the people who need it most. Now we’ve shown it’s commercially viable," he said.
FMO CIO Linda Broekhuizen added: "FMO is very proud to have arranged the senior debt package for this true frontier transaction with such large development impact, which provide renewable energy to a country with urgent electricity needs."
Power for Rwanda
The Rwanda Government is hoping that this project will kickstart an energy revolution in the country. Currently, Rwanda generates just 110 MW of electricity a year, reaching less than one-fifth (17%) of its population. By 2017, the government aims to increase that capacity to 560 MW, with 50% of the population connected to the grid.
"Generation and provision of electricity to all Rwandans is important for the Government of Rwanda," said Emma Francoise Isumbingabo, the Rwanda Minister of State in Charge of Energy and Water. "This initiative to produce 8.5 MW of solar power is a good addition towards closing the current energy gap."
Further investment in Rwanda's energy sector was revealed last week when The African Development Bank (AfDB) announced the extension of a concessional loan worth $40 million to help fund the country’s energy access expansion plans. "Energy plays a key role in the development of our economy," said the Minister of Finance and Economic Planning, Claver Gatete. "Almost all sectors are driven by energy – increased electricity access creates employment opportunities, increases farm jobs, contributes to industrial development and reduces production costs through decreased electricity tariffs."
Much of the $40 million loan will be diverted towards renewable projects in the country, largely in the hydropower sector, which has a current capacity of 44.8 MW. However, a further 333 hydro sites have been identified, with a combined capacity of 96 MW.
The AfDB's involvement in Rwanda is part of the bank's wider Power Africa campaign, which has been supported by the United States of America Presidential Initiative and boasts a pot of $600 million set aside for renewable energy initiatives across the continent.