Gigawatt Global’s 7.5MW solar plant in Burundi to become first grid-connected project supported by REPP to begin full construction
UK government-funded REPP set to continue support for country’s first private-sector grid-connected solar project with construction bridge loan
London, 23 January 2020: Gigawatt Global’s 7.5MW solar plant in Burundi is to become the first grid-connected project supported by the Renewable Energy Performance Platform (REPP) to begin full construction.
The project is also the first grid-connected solar development by an independent power producer (IPP) in Burundi. It is hoped the success of the venture will pave the way for further foreign investment into the country’s renewable energy sector by demonstrating the government’s increased capacity - and willingness - to enter into bankable power purchase arrangements.
Full construction works on the plant in Mubuga, in Gitega Province, is set to begin imminently after Notice to Proceed was issued earlier this week.
This marks a key milestone for REPP, which was set up in 2015 with funding from the UK’s International Climate Finance to help small and medium-scale renewable energy projects attract private and institutional investment in sub-Saharan Africa.
REPP has been supporting the project with development capital since December 2016, and has now committed to provide a construction bridge loan. The balance of the funding will be provided by a matching construction bridge loan and equity investment from Evolution II Fund, managed by Inspired Evolution Investment Management, and further equity funding by the project developer and co-sponsor, Gigawatt Global Coöperatief.
Upon or after the project’s commercial operations date, part of REPP’s construction bridge loan will be refinanced as a 10-year subordinated loan.
Geoff Sinclair, Managing Director of Camco Clean Energy, which manages REPP, said: “Today’s announcement is a landmark moment for Burundi’s energy sector - once built the solar plant will add nearly 15% to the generation capacity of its grid using clean energy. It’s also an important milestone for REPP, as this project is the first in its portfolio to begin full construction, having received funding support from REPP throughout its development and financial close process.
“With REPP’s support, the Mubuga project will have a substantial positive impact on the country and is a clear demonstration of the important role that the private sector has to play in boosting Africa’s electricity supply with affordable renewable energy.”
Michael Fichtenberg, Managing Director of Gigawatt Global Burundi SA and the lead project director, said: “Bringing clean energy to one of the world’s least developed countries fulfils Gigawatt Global’s mission to be a premier impact platform of choice for renewables in Africa. We believe this demonstrates how solar power can be implemented in other developing markets, while decreasing dependency on costly and polluting diesel generators.
“We are extremely pleased to be working with Inspired Evolution, REPP and our other financing partners, as well as our partners in the government of Burundi, in particular the Ministry of Energy.”
It is estimated that the plant, which follows Gigawatt Global’s first project in Rwanda, will be able to supply the electricity needs of around 87,600 people and businesses, and provide 300 part-time jobs during construction and support up to 50 permanent jobs during the operational phase.
Christopher Clarke, Managing Partner at Inspired Evolution, congratulated all parties involved in getting the project to this stage for their part in helping to realise a high development impact solar PV generation plant in Burundi.
“This is a pioneering project in many ways, both to open up the IPP market in Burundi and to crowd in funders and credit enhancement providers to realise a complex but important project for the country,” he added.
The Renewable Energy Performance Platform (REPP) works to mobilise private sector development activity – and investment – in small to medium-sized projects (typically up to 25MW). It is supported with £148m funding from the UK’s International Climate Finance through the Department for Business, Energy and Industrial Strategy (BEIS), and to date has agreed contracts with 25 renewable energy projects across 13 countries, employing five different technologies (solar home systems, solar PV mini-grids, grid-connected solar PV, run-of-river hydro, and onshore wind).
About Camco Clean Energy
Camco Clean Energy is a global leader in sustainable energy projects finance. Its long-established position within Africa’s renewable energy sector enables the company to provide project developers and sponsors with a trusted combination of global access and local presence, enabling them to source the right financing solutions to develop and build projects.
Since formation, it has provided creative finance solutions to 180 projects worth US$15bn, and in geographies as diverse as Madagascar to Malaysia and the US to Uganda.
About Gigawatt Global Gigawatt Global Coöperatief U.A. is a multinational renewable energy company and impact investment platform focused on the development of profitable utility-scale installations, actively implementing solutions to promote the UN Sustainable Development Goals across Africa. Led by a team of seasoned project developers, financiers, impact investors and green energy experts, the American-owned Dutch company is a founding partner of the U.S. Power Africa program, and has solar, wind and hydro projects under development in 10 African countries. www.gigawattglobal.com
About Inspired Evolution and Evolution II Fund Inspired Evolution, investment advisor to Evolution I and Evolution II Funds, is a specialised clean energy infrastructure and resource efficiency investment advisory platform with offices in Cape Town, London, Nairobi, Abidjan and Mauritius. Inspired Evolution has been involved in developing and financing more than 1,000 MW of renewable energy infrastructure generation projects across Sub-Saharan Africa. Evolution II Fund’s current investors include the Dutch Development Bank FMO, the Global Energy Efficiency and Renewable Energy Fund (“GEEREF”), the European Investment Bank, UK development finance institution CDC Group, Swiss Investment Fund for Emerging Markets (“SIFEM”) managed by Obviam, African Development Bank (“AfDB”), the Swedish development finance institution Swedfund and the Finnish Fund for Industrial Cooperation (“Finnfund”).
About the UK’s International Climate Finance International Climate Finance is a UK Government commitment to support developing countries to respond to the challenges and opportunities of climate change. At the UN Climate Action Summit in New York in September the UK announced a doubling of its International Climate Finance from £5.8bn over the period 2016-2020 to at least £11.6bn over the period 2021-2025. This places the UK amongst the world’s leading providers of climate finance. Programmes are focused on: ? Building the resilience of the poorest people and communities ? Ensuring that the vast expansion in infrastructure in developing countries is low-carbon ? Halting deforestation