2 January 2016

East Africa: AfDB Approves $138m for Rusizi III Hydro Project

Photo: Stelios Comninos
Sunset over Nile River.

The African Development Bank (AfDB) has approved $138 million in loans and grants to finance the Rusizi III hydropower plant project.

A statement from the AfDB indicates that the implementation of the project will be carried out at a total cost of $625.19 million. At least $138.88 million will be borne by the AfDB's public sector window and $50.22 million by the private sector window.

Rusizi III hydropower plant is part of the Programme for Infrastructure Development in Africa and involves Burundi, the Democratic Republic of Congo and Rwanda.

The financing will enable the construction of a run-of-river dam straddling the Rusizi River between the DRC and Rwanda, as well as a 147 MW power plant and distribution station.

These new facilities will provide an independent source of green energy, helping the DRC, Rwanda and Burundi to meet their growing energy needs. All the three countries have been experiencing difficulties in meeting the demand for electricity, due to over a decade without major energy infrastructure investments while their populations and economic activity have continued to grow.

Affordable power

By ensuring reliable and affordable power, the Rusizi III hydropower plant project will increase the region's access to electricity by 300 per cent. As a regional project, the electricity generated will also feed into the East African Power Pool.

Rusizi III hydropower plant project is the first regional power project in East Africa to be built under a public-private partnership. Under this framework, the project's implementation has been entrusted to the Great Lakes Energy Organisation, a sub-regional body, which co-ordinates energy development in East Africa.

Its implementation has been possible following a grant awarded to EGL in 2011 by the Partnership for Africa Development (Nepad) infrastructure project preparation facility (NEPAD-IPPF) to finance transaction advisory services for the project.

The $1.4 million NEPAD-IPPF grant helped provide key expertise for the project's development, as well as sound knowledge of the context and actors of the region that led to the project's eventual financial close.

The grants are used to carry out pre-feasibility, feasibility, technical and engineering designs as well as transaction advisory services.

NEPAD-IPPF is supported by Canada, Germany, UK, Spain Denmark and Norway.

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