BURKINA FASO – Multilateral Investment Guarantee Agency (MIGA), an international financial institution, has issued a guarantee for US$5.19 million to GreenYellow SAS of France, a renewable energy company.
The funding will cover GreenYellow’s equity and quasi-equity investments into Société de Production d’Energie Solaire de Ouagadougou SAS (SPES Ouagadougou) for a period of up to 20 years.
The SPES Ouagadougou project consists of the construction, ownership, operation and maintenance of a solar PV energy facility that will ultimately produce 30MWp of power.
The electricity output will be sold to Société Nationale d’Electricite du Burkina (SONABEL), the Burkinabe state-owned utility, under a 25-year take or pay Power Purchase Agreement (PPA).
The PPA will be backstopped by a Public Private Partnership Agreement from the Government of Burkina Faso through the Ministry of Energy and the Ministry of Finance.
“This solar facility will help narrow Burkina Faso’s power deficit in a cost-effective manner while supporting the country’s transition to renewable energy. MIGA’s support sends a clear signal to private sector of the possibilities in the Sahel region,” Hiroshi Matano, MIGA executive vice president said.
Burkina Faso currently has 357MW of installed capacity, mostly from ageing and expensive heavy fuel oil generation and using imports from Côte d’Ivoire and Ghana to serve base demand.
“With this solar project, GreenYellow strengthens its positions in Africa and leverages its unique decentralised model to help Burkina Faso substantially reduce its dependency on imported energy, increase the use of clean, climate-friendly renewable energy and reduce energy cost for the country’s citizens,” Otmane Hajji, GreenYellow President said.
“Political risk insurance from MIGA demonstrates the Group’s ability to finance its growth ambitions in promising markets like Burkina Faso.”
This project was approved by MIGA’s Board of Directors along with three other solar PV projects that are independent of one another but similar in terms of structure.
Collectively, the projects will have a capacity of 102MWp and constitute the country’s first round of solar Independent Power Producers. MIGA’s support for these solar projects is considered critical to their realisation, both by investors and by the government.
Through the Sahel Alliance Initiative, the World Bank Group (WBG) is actively engaged in strengthening institutional capacity and expanding access to renewable energy in the G5 Sahel Countries (Burkina Faso, Chad, Mali, Mauritania and Niger).
This project contributes to the WBG’s efforts to double renewable energy installed capacity and electricity access in the G5 countries over 2018-2023.
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