Zambia - African Development Bank's Sustainable Energy Fund for Africa Approves $8 Million for Development of 25 Mw Solar Plant

29 October 2024
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African Development Bank (Abidjan)
announcement

The African Development Bank Group's Board of Directors has approved an $8 million concessional loan to support the construction of a 25MW Solar Photovoltaic power plant in Zambia. The financing for the Ilute Plant will be sourced from the Sustainable Energy Fund for Africa (SEFA), a multi-donor Special Fund managed by the Bank. Ilute is expected to advance Zambia's sustainable development and help the country unlock its renewable energy potential.

The venture has faced rising costs associated with the COVID-19 pandemic and other challenges. Serengeti Energy Ltd and Western Solar Power Ltd are leading the plant development in Zambia's Sesheke District. Competitively selected by GreenCo Power Services Ltd (GreenCo), this project will serve as a pilot for GreenCo's energy aggregator model under the Zambia Electricity Supply Corporation Limited (ZESCO) open grid access framework. Acting as an intermediary off-taker, GreenCo will purchase the generated electricity through a 25-year Power Purchase Agreement and sell it to the Southern African Power Pool Day-Ahead Market.

"We are delighted to support the Ilute Solar PV project - which will be the first project to use Africa GreenCo as an intermediate off-taker. SEFA's support has been instrumental in bridging the financing gap and will pave the way for future projects that contribute to Southern Africa's energy transition," said Dr Daniel Schroth, African Development Bank Director for Renewable Energy and Energy Efficiency.

Anton-Louis Olivier, CEO of Serengeti Energy, acknowledged SEFA's support. He said, "We appreciate the support from the African Development Bank Group and SEFA in helping us move the Ilute 25MW Solar PV project forward. This loan addresses the financial challenges we've faced due to the pandemic and rising costs. The Ilute project is a testament to innovative collaboration and serves as a pioneering model for future renewable energy initiatives in Zambia as well as the wider region." Serengeti Energy is a leading renewable independent power producer specialising in the development, construction, and operation of utility-scale renewable energy plants tailored to the needs of both public and private off-takers.

About SEFA

SEFA is a multi-donor Special Fund that provides catalytic finance to unlock private sector investments in renewable energy and energy efficiency. SEFA offers technical assistance and concessional finance instruments to remove market barriers, build a more robust pipeline of projects and improve the risk-return profile of individual investments. The Fund's overarching goal is to contribute to universal access to affordable, reliable, sustainable, and modern energy services for all in Africa, in line with the New Deal on Energy for Africa and Sustainable Development Goal 7.

Read the original article on African Development Bank (AfDB).

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