The Board of Directors of the African Development Bank (AfDB) approved on 25 June, 2014 a US$ 116.7 million loan to the Mauritius Central Electricity Board (CEB), the state owned electricity utility, for the redevelopment of the Saint Louis Power Plant.

The Saint Louis Power Plant Redevelopment Project, which has a total cost of US$ 129.7 million, aims to increase the firm generating capacity of the CEB so as to maintain reliability of supply, reduce environmental impacts and stabilize the electricity supply.

The Saint Louis Power Station is located five kilometres south of the centre of the capital city Port Louis. The project will provide four medium-speed, four-stroke, heavy fuel oil (HFO) driven generators with a capacity of 15 MW each; a power station building; two 1,000 cubic metre tanks for the storage of HFO; and one 132 kV substation for connection of the power plant to CEB's existing electricity grid.

The electricity produced by the project installations will be distributed to all corners of the main island of Mauritius, where around 97% of the country's population of 1.29 million reside. "As a result of the project demand, growth could be met guaranteeing the provision of adequate power supply to all sectors of the economy on the main island. Populations in residential area and workers in the industrial zone adjacent to the power station will benefit from reduced levels of gaseous emissions and noises," said Alex Rugamba, director of the AfDB's Energy, Environment and Climate Change Department explained.

Though the CEB is presently able to meet the peak load with the existing installed generation capacity, projections indicate that, without the additional generating capacity made available by the project, it will not be in a position to do so by the second half of 2015. According to electricity supply demand projections, at the end of 2015, the demand of customers in Mauritius will exceed the installed generating capacity connected to the power grid. This project which will increase the installed capacity by 60 MW will contribute to bridge the gap in power supply.

The main sectors of the Mauritius' economy - tourism, textiles and financial services - are all dependent on the availability of a secure and reliable supply of electricity. The government is currently finalizing a ten-year Economic and Social Transformation Plan (ESTP). For its implementation, the government has prepared the 2014 - 2018 Public Sector Investment Program (PSIP), which includes the proposed project. The government will be relying on the AfDB as a lead financier in closing any gap in the financing of the PSIP.

This project will be the AfDB's first major intervention in Mauritius' energy sector. The AfDB has wide experience in similar types of projects in many African countries. The additional knowledge gained under the project will be useful as the Bank designs projects in its island member states and in areas of continental Africa that are far away from transmission grids.