The FINANCIAL — IFC, a member of the World Bank Group, on July 9 announced that IFC InfraVentures, the global infrastructure project development fund, and Scatec Solar, an integrated independent power producer, have signed documents to develop the $55 million Scatec Segou solar power project in Mali with a local developer, Africa Power 1. The project is expected to increase the renewable energy component of Mali’s power supply, helping to advance the country’s ambitions energy development goals.
The Scatec Segou solar project comprises the development, construction and financing of a 33 megawatt greenfield solar photovoltaic power project located in Segou, 240 kilometers from Bamako. IFC will invest $12.5 million for its own account in addition to $2.5 million already spent for a 20 percent equity stake in the project company and mobilize parallel loans of up to $15.2 million Euros, according to IFC.
Thanks to the excellent solar resources available in Mali, Scatec Segou is expected to substantially increase the renewable energy component of the country’s power supply. The project will add much -needed generation capacity to the national grid, helping to reduce the supply shortage and further strengthening the private sector participation in the power sector.
Speaking at the signing ceremony for Scatec Solar, Mr. Mamadou Igor Diarra, the Minister of Finance said, “Although Mali has recently experienced some significant challenges, we still have very ambitious plans to attract investors. This project represents an important milestone in developing the energy sector to help strengthen our economy.”
Mr. Mamadou Frankaly Keita, Mali’s Minister of Energy and Water said “This landmark agreement signals the Government of Mali’s commitment to meet the nation’s growing energy demand and to provide clean, renewable and affordable energy to our people.” Mr Mamadou Frankaly Keita, Malian Minister of Energy and Water.
Scatec Solar’s CEO Raymond Carlsen said, “This project is another great milestone for Scatec Solar. After several years of development efforts in the region, we can now move forward with the first utility-scale solar IPP in West Africa. The Malian Authorities have demonstrated decisive will to tackle the nagging issue of power supply.”
Dr. Ibrahim Togola, the chairman of Africa Power 1 SA and Einstein SolarWorld Prize 2014 winner says: “This is an historical event for Mali, which is on its way to installing the largest solar grid-connected power plant in West Africa. The participation of Malians in this high profile joint-venture will serve as a model that opens the solar era in West Africa”
“One of the pillars of the World Bank’s Country Assistance Strategy for Mali is to increase access to energy, a development fundamental. IFC InfraVentures’ partnership with Scatec Solar and Africa Power 1 helps advance this strategy through Scatec Segou. We believe that this project can have a strong demonstration effect and pave the way for a series of renewable energy projects in the country,” said Mr.Paul Noumba Um, World Bank Country Director for Mali.
Recent years have seen a marked growth in investor interest in African infrastructure projects, however, not enough projects are sufficiently bankable to absorb the funding available. IFC InfraVentures’ investment in the development of the Scatec Segou project is part of wide-ranging efforts to address the continent’s gap in project development by providing early stage risk capital to create commercially viable initiatives that can rapidly achieve financial close. Several other IFC InfraVentures-supported projects are expected to achieve financial close in the near future.
IFC, a leader in emerging market renewable energy finance, is uniquely positioned to help countries transition to a low carbon future. As part of a wider program to help mitigate climate change, IFC is investing in and providing advisory services to private enterprises in the renewable energy sector, throughout emerging markets and across all parts of the supply chain.