(Ecofin Agency) – In the DRC, the rate of access to electricity is currently around 21.5%. Capitalizing on the country’s considerable hydroelectric potential, estimated at more than 100,000 MW, will contribute to achieving the Congolese authorities’ objective of increasing this rate to 62.5% by 2030.
In the Democratic Republic of Congo (DRC), the African Export-Import Bank (Afreximbank) announced its support for the construction of a 200 MW hydroelectric plant, which will be located in the Lufira basin, in the southeast of the country. Concretely, it will finance the technical studies, assess the financial viability, cover the legal and financial advisory costs and structure the debt financing, an essential aspect to guarantee the economic feasibility of this project. This, on behalf of Kipay Investments, an independent Congolese producer, which already operates the Lumbwe photovoltaic power plant, in the DRC.
This is the first time that the institution has supported a private sector renewable energy project in the Democratic Republic of Congo (DRC).
This project meets the strategic objective of increasing access to electricity in the DRC, where the electrification rate is around 21.5%. The Congolese authorities plan to increase this rate to 62.5% by 2030, while capitalizing on the hydroelectric potential of the DRC, estimated at more than 100,000 MW. For comparison, although promising, the Inga 3 megaproject is hampered by persistent administrative and financial obstacles. This private initiative, on the other hand, illustrates a pragmatic path to meeting growing energy demand while attracting private investment.
“Afreximbank is proud to support renewable energy projects that not only drive industrialization and exports, but also promote a just energy transition. This pioneering project demonstrates our commitment to exploiting renewable resources to build sustainable energy infrastructure in the DRC”said Kanayo Awani, Afreximbank Executive Vice President for Intra-African Trade and Export Development.
https://x.com/afreximbank/status/1869704973988057310
According to Kipay Investments, the Lufira River power plant will have several positive impacts. It will provide clean and reliable energy to mining companies, thus promoting the local processing of strategic minerals such as copper and cobalt, essential to the global energy transition. It will also allow a reduction in greenhouse gas emissions, estimated at 108,000 tonnes of CO₂ equivalent per year, thus contributing to the DRC’s climate commitments, under the Paris Agreement.
In addition to its positive impact on the environment, the project will allow the creation of more than 2,000 direct jobs and 952 potential indirect jobs, while local economic activities, such as fishing and trade, will benefit from the opportunities generated by the reservoir which will be set up. Improving access to electricity in neighboring communities will also enable better access to education and health care. Furthermore, the DRC government will benefit from tax revenues generated over a period of 30 years.
No date has been announced for when the infrastructure will go into production.
Olivier de Souza
Read also:
09/20/2023 – Inga 3 project: the DRC is still struggling to attract the necessary investments, according to President Tshisekedi
12/11/2024 – DRC: $36 billion to reach 62.5% electricity access rate
