Private Infrastructure Development Group (PIDG) company, the Emerging Africa Infrastructure Fund (EAIF), today announced 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 an essential strategic economic asset for Côte d’Ivoire, where electrification rates range from 88% in urban areas to as low as 31% in rural parts of the country. By displacing expensive peak-time diesel production and reducing CO2 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, noted: “The new facility at Singrobo will be Cote d’Ivoire’s first hydro-electric development by an independent power producer. We are excited that it delivers on three of PIDG’s strategic objectives: mobilising private capital, enabling economic development and contributing to increasing Africa’s stock of renewable energy infrastructure.”
The Singrobo plant catalyses the Ivorian government’s strategic plan for the development of the electricity sector, which aims to increase the total installed capacity to 4.2 GW (from approximately 2.2 GW currently) by 2030 mainly through Public-Private Partnerships, reaffirming EAIF’s role as a pathfinder supporting the development of nascent renewable energy markets.
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. In addition to closing the rural energy access gap and strengthening economic productivity, the plant’s flexible operating model enhances grid resilience, meaning it may be called in to meet baseload and peak demand.
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). Furthermore, 25% of the project cost is funded by equity from the project’s shareholders, IHE Holding, the Africa Finance Corporation 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 project site is located on the Bandama River, 23 km downstream of the existing Taabo Dam and upstream of the confluence of the Nzi River. It is 3.5 km from the Singrobo village in the province of Taabo and 148 km by road from Côte d’Ivoire’s capital city, Abidjan.
The Emerging Africa Infrastructure Fund provides a variety of debt products to infrastructure projects promoted mainly by private sector businesses in Africa and parts of the Levant.
The Fund helps create the infrastructure framework that is essential to sustained economic stability, business confidence, job creation and poverty reduction. It has to date supported over 90 closed infrastructure projects across nine sectors in over 20 African countries. At 30 June 2022 EAIF had a committed loan book portfolio of over US$1.15 billion.
EAIF is part of PIDG. EAIF was established and substantially funded by the governments of the United Kingdom, The Netherlands, Switzerland, and Sweden. It raises its debt capital from public and private sources, including Allianz, the global insurance and financial services company; Standard Chartered Bank; the African Development Bank; the German development finance institution, KFW and FMO, the Dutch development bank. EAIF is managed by Ninety One.
The Private Infrastructure Development Group (PIDG) is an innovative infrastructure development and finance organisation which encourages and mobilises private investment in pioneering infrastructure in the frontier markets of sub-Saharan Africa and south and south-east Asia to promote economic development and combat poverty.
PIDG delivers its ambition in line with its values of opportunity, accountability, safety, integrity and impact. Since 2002, PIDG has supported 190 infrastructure projects to financial close which provided an estimated 220 million people with access to new or improved infrastructure. PIDG is funded by six governments (the United Kingdom, the Netherlands, Switzerland, Australia, Sweden, Germany) and the IFC.
Ninety One is an independent, active global asset manager listed on the London and Johannesburg stock exchanges. Established in South Africa in 1991, as Investec Asset Management, the firm was a pioneer in emerging markets in Africa.
In 2020, almost three decades of organic growth later, the firm de-merged from Investec Group and became Ninety One. Today, Ninety One offers distinctive, active strategies across equities, fixed income, multi-asset and alternative investments to institutions, advisors and individual investors around the world.
