A press release published on the website of the African Development Bank (AfDB) Group noted that the pan-African financial institution has approved concessional financing of 6 million euros from the Sustainable Energy Fund for Africa (SEFA). , a special multi-donor fund managed by the Bank, to accelerate the completion of the Dédougou solar photovoltaic project in Burkina Faso, in support of the Bank’s Desert-to-Power initiative.
According to the official document, the project includes the design, construction and operation of an 18 Megawatt (MW) solar power plant in Dédougou, located 250 kilometers west of the capital, Ouagadougou.
Remember that Burkina Faso is one of the five priority countries of the “Desert-to-Power” initiative, which aims to produce 10 gigawatts of solar energy in 11 Sahel countries by 2030, thus promoting development socioeconomic.
This project is one of the first independent power producers (IPP) in Burkina Faso and has obtained both senior and subordinated loans, as well as a power purchase agreement (PPA). 25 years with the National Electricity Company of Burkina Faso (SONABEL).
However, we read in the press release, the project encountered difficulties in achieving financial closure due to cost increases linked to the Covid-19 pandemic. The SEFA Covid-19 IPP Relief Program played a crucial role in overcoming these obstacles. Through concessional financing, SEFA helped restructure financial arrangements to absorb additional costs linked to the pandemic, ensuring the viability of the project while preserving the structure initially agreed with the government of Burkina Faso, thereby contributing to the energy security of the country.
Under the SEFA programme, a senior concessional loan of €2.5 million and a repayable grant of €3.5 million were provided through its concessional financing facility. SEFA’s involvement was instrumental in unlocking additional financing from the Dutch entrepreneurial development bank FMO, including subordinated and senior loans. These funds will be paid to Dédougou Solaire SARL, the project company jointly developed by QAIR, which is responsible for project management.
As part of the Desert-to-Power initiative, the project is expected to contribute to energy security, diversification of the energy mix, reduction of electricity costs and increase in national electrification rates.
The Director of the Renewable Energy and Energy Efficiency Department at the African Development Bank, Daniel Schroth, said that “the Dédougou solar PV project increases Burkina Faso’s renewable energy production capacity, in line with current objectives of the Desert-to-Power initiative. By supporting projects like this, we are making concrete progress towards electrifying the Sahel, strengthening energy security and improving the living conditions of millions of people.”
For his part, Abdoulaye Toure, financial director of Qair Afrique who welcomed the support of SEFA and the progress of the project suggested that “we are satisfied with the approval of this financing from SEFA and thank the African Development Bank for his support for the project. This allows us to advance our commitment to supporting Burkina Faso’s energy goals by developing a second solar power plant, only one year after the successful commissioning of Zano. This achievement aligns with the country’s energy supply ambitions and reinforces Qair’s vision to become a key player in Africa’s renewable energy sector in the years to come.”
Moctar FICOU / VivAfrik
