Emerging Africa Infrastructure Fund backs Ivory Coast hydro power project
The Emerging Africa Infrastructure Fund (EAIF), part of Private Infrastructure Development Group (PIDG), said Tuesday it has inked a €25 million finance facility to Ivoire Hydro Energy (IHE), which will build a 44MW hydro electricity generation plant on the Bandama River near the village of Singrobo in Côte d’Ivoire.
EAIF’s long-term financing package enables IHE to achieve financial close for the project, catalysing the design, construction and operation of the power plant and associated infrastructure and boosting rural access to clean energy.
The new plant will be a strategic economic asset for Côte d’Ivoire, where electrification rates range from 88% in urban areas to as low as 31% in rural parts. By displacing expensive peak-time diesel production and reducing carbon emissions by 124,000 tons per annum, the plant is also integral to the government’s efforts to achieve the UN’s Sustainable Development Goals on Climate Action (SDG 13) and on Affordable and Clean Energy (SDG 7).
The construction of the plant – as well as 3km of access roads and a 4km 90 kV transmission line and substation to connect the hydropower plant to the existing Taabo-Agboville transmission line – will generate over 500 jobs.
Paromita Chatterjee, Investment Director at Ninety-One, the fund manager for EAIF, said: “The new facility at Singrobo will be Cote d’Ivoire’s first hydro-electric development by an independent power producer.”
A long-term power purchase agreement will see all of the energy produced by the Singrobo plant sold to Compagnie Ivoirienne d’Electricité, the operator of Côte d’Ivoire’s national grid.
The African Development Bank (AfDB) acted as the mandated lead arranger of the debt finance and will be a senior lender in its own right. In addition to AfDB and EAIF, the other lenders are the German international development agency, DEG and the Africa Finance Corporation (AFC).
Further, 25% of the project cost is funded by equity from the project’s shareholders—IHE Holding, AFC and DIPFA, a Denham Capital-owned international investment platform for power projects. Neo Themis SARL is advising and acting for the shareholders in relation to finalising the project’s development and the financing agreements.
The EAIF provides a variety of debt products to infrastructure projects promoted mainly by private sector businesses in Africa and parts of the Levant. It has to date supported over 90 closed infrastructure projects across nine sectors in over 20 African countries. As of June 2022, EAIF had a committed loan book portfolio of over $1.15 billion.