The International Financial Corporation (IFC), a member of the World Bank Group, and the government of Canada have joined hands to support Zambia with $25 million in financial aid for clean and affordable energy.
The funding will be utilised for the construction of a solar project under the second ‘Scaling Solar’ initiative to meet the country’s energy shortage.
Scaling Solar is a World Bank Group initiative that aims to support the development of more than 1 GW of solar power across Africa. It provides competitive bidding and simplified procurement for grid-tied photovoltaic power, even in smaller markets. Scaling Solar has financing support of USAID’s Power Africa, the Private Infrastructure Development Group company, DevCo, the Ministry of Foreign Affairs of the Netherlands, the Ministry of Foreign Affairs of Denmark, and the UK Department for International Development.
“Scaling Solar has set a new standard for the development of solar power in Africa, starting with these two projects in Zambia. We are very pleased to see these projects moving toward construction as the program continues to expand across Africa and into new regions,” said IFC CEO Philippe Le Houérou. “
The financial package of senior loans up to $10 million has been arranged by IFC and another $12 million has been provided from the IFC-Canada Climate Change Program.
Apart from this, $2.5 million will be given in the interest-rate swap from IFC and $2.8 million partial risk guarantee has been arranged from World Bank’s International Development Agency.
The European Investment Bank is also giving $11.75 million in loans for the project which will be built near its capital city of Lusaka.
The construction of the solar project under first ‘scaling solar’ initiative in Zambia is expected to begin shortly and will be developed by Neoen (a French project developer) and First Solar. The project is located near Lusaka and has a tariff equivalent to six U.S. cents per kW.
Earlier, Mercom reported that Sterling & Wilson, a global solar engineering, procurement, and construction (EPC) company, was selected to provide EPC services for the construction of Zambia’s first utility-scale solar plant. The grid-connected solar photovoltaic (PV) project will have a capacity of 54.3 MW.
The World Bank has also approved $180 million in assistance to Kenya to strengthen the financial health of the Kenya Electricity Generation Company Limited (KenGen) and improve private sector financing in the energy sector.
Nitin is a staff reporter at Mercomindia.com and writes on renewable energy and related sectors. Prior to Mercom, Nitin has worked for CNN IBN, India News, Agricultural Spectrum and Bureaucracy Today. He received his bachelor’s degree in Journalism & Communication from Manipal Institute of Communication at Manipal University and Master’s degree in International Relations from Jindal School of International Affairs. More articles from Nitin Kabeer