Annual Report 2015

PIDG FACILITIES

 

InfraCo Africa

Originating, developing, structuring, investing and managing infrastructure projects in sub-Saharan Africa

Projects that had Joint Development Agreements signed in 2015

Ethiopia Corbetti Geothermal

Chad Djermaya Solar

Tanzania Redavia Solar  – Phase 1

Mozambique Pavua Hydropower

Zambia Western Power

 

Projects that reached Financial Close in 2015

Tanzania Redavia Solar – Phase 1

 

Projects that were sold in 2015

Ghana Ghana Wind

Achievements in 2015

In Q4 of 2015, InfraCo Africa reached financial close on the rapid scale up of Redavia; an innovative off-grid containerised solar business in Tanzania. Redavia has considerable potential for replication.

 

Other notable highlights

InfraCo Africa signed five new JDAs in 2015, committing up to $31m to develop renewable energy projects in five different sub-Saharan countries (Zambia, Mozambique, Ethiopia, Chad and Tanzania). The projects include two hydro, one geothermal and two very different solar power projects. The JDAs represent success for our new approach of a mix of developer teams and co-development, with two signed by eleQtra, one by AADL and two co-developments.

InfraCo Africa substantially progressed work on Corbetti, Ethiopia’s first IPP Geothermal project. Harnessing geothermal expertise and innovative finance from across the world, Corbetti will develop an exciting renewable energy source with possibilities for replication across the Rift Valley.

InfraCo Africa has enhanced its team with two experienced project managers, building its capacity in solar, geothermal and wind power.

Kalangala Infrastructure Services (KIS) is nearing completion of the 66km road upgrade on Bugala Island, Uganda. This achievement marks the final stage of a project which has delivered clean water, solar power, reliable ferries and improved road infrastructure to Bugala Island.

 

2016 and Beyond

InfraCo Africa will continue to provide the necessary capital to accelerate infrastructure project pilots which can then be scaled up and/or replicated. Although not without risks and challenges, its new strategy enables it to demonstrate early on that a project is viable and sustainable, building engagement and attracting private investment.

InfraCo Africa works to engage with local communities on all of its projects. For its larger-scale projects, it will pursue innovative initiatives that share benefits with those living near the project sites to help communities develop and achieve their goals. Alongside this, InfraCo Africa has identified that attracting private finance to the sub-Saharan water sector can be extremely challenging and so InfraCo Africa is exploring opportunities to embed community water projects into its larger scale energy projects; leveraging economies of scale, drawing investment into frontier markets and increasing the development impact of its work.

InfraCo Africa will continue to work closely with its developer partners, building its pipeline of projects and increasing its market presence. It will also actively pursue co-development opportunities. InfraCo Africa will continue to exchange knowledge with its sister Facility, InfraCo Asia, and will work closely with other PIDG Facilities to maximise its impact.

Tanzania Redavia

Delivering 3MW of containerised off-grid solar power to rural businesses and homes

Context

Tanzania has an electrification rate of just 3.6% in rural areas. Many of the 7.8 million rural households and 2.4 million small to medium enterprises (SMEs) operating in Tanzania’s frontier markets are reliant upon expensive kerosene or diesel generators. In order to address this challenge, the Government of Tanzania (GoT) established the Rural Energy Agency (REA) to promote and facilitate off-grid power solutions. Tanzania’s high irradiation levels, coupled with the falling cost of solar photovoltaic (PV) panels, identifies off-grid solar as a competitive energy solution for rural communities.

 

Opportunity

Redavia Tanzania Asset Ltd. (‘Redavia’) was founded in 2014 by its parent organisation Redavia GmbH and funders including the Shell Foundation and Renewable Energy and Energy Efficiency Partnership (REEEP). Redavia GmbH has developed an innovative solution to rural power: standardised shipping containers, each with an installed capacity of up to 100KWp of solar power, which can be assembled on site in just six days. Redavia’s technology provides standalone power or can hybridise with existing diesel generators to reduce operating costs and harmful emissions. Offered on a rental basis, individually or as a modular array, the containers are maintained by Redavia and can be redeployed if necessary. This innovative model avoids the high up-front costs and lengthy development and construction periods associated with static PV, providing a sustainable, affordable power solution for small businesses and rural communities.

Redavia offered InfraCo Africa the opportunity to provide highly catalytic capital, which is expected to allow the company to scale up, thereby enabling it to attract private sector investment, once it demonstrates its ability to scale. In 2015, InfraCo Africa signed a Convertible Loan Agreement with Redavia, providing the capital needed to build and rent two containers to a local mini-utility, which will construct a mini-grid, and connect and bill households in the rural communities of Isenzanya and Shitunguru. The pilot phase will provide learning to feed into the construction and deployment of around 30 further containers, enabling Redavia to broaden its customer base and demonstrate scalability. Once operating at scale, InfraCo Africa will exit the business, securing further private sector investment to enable its expansion.

 

Impact

Redavia’s solar PV containers will transform rural living standards and provide isolated SMEs with the sustainable, long-term power solution they need to be productive and profitable, fuelling economic growth in Tanzania. Pursuing the rapid deployment of containerised off-grid solar power will also reduce CO2 emissions as solar panels displace the use of diesel generators, kerosene and wood fuels.

Uganda Kalangala Infrastructure Services (KIS) completes its final phase

KIS has developed and operates a multi-sector utility providing critical infrastructure services to communities on Bugala Island in Lake Victoria, Uganda. In partnership with the Government of Uganda, KIS has provided safe, reliable access to mainland services, facilitated trade, improved islanders’ health, provided employment and enabled business and economic growth.

2015 saw KIS commissioning a new water treatment facility providing clean, potable water to 19 villages. KIS also commissioned its 1.6MW solar diesel hybrid plant, connecting 2258 households to their newly constructed grid and taking over operation of the government’s grid in Kalangala Town. Initially building and operating two roll-on roll-off ferries. The final strand of infrastructure, widening and resurfacing the 66km Luuku to Mulabana Main Road with durable, local murram, is due to be completed in early 2016 and marks the final phase of the $49m KIS project, completing all four aspects of the project.

BACK TO TOP