africa development Economy Energy Finance Infrastructure Mozambique

Scatec Solar closes financing for Mozambique’s first large-scale PV project

Scatec Solar, KLP Norfund Investments and Electricidade de Mozambique (EDM) have closed debt financing and started construction on a 40MW PV project in Mozambique.

The debt financing for the installation is provided by the International Finance Corporation (IFC), a member of the World Bank Group, and the Emerging Africa Infrastructure Fund.

The 40MW project will be the first large-scale solar plant developed in Mozambique and stands as an important step forward in the country’s goal of boosting its renewable-energy sector.

Scatec Solar and its partners signed of on a 25-year PPA for the project back in October 2016. As part of the agreement, electricity generated by the installation will be sold to state-owned utility company EDM.

The installation, located close to the city of Mocuba in the Zambézia Province, is expected to generate 79,000 MWh of electricity per year to the northern regions of Mozambique. Once completed, the plant will produce enough energy to serve around 175,000 homes.

The project costs are estimated at around US$76 million — funded through equity of US$14 million, a grant of US$7 million and project debt of US$55 million. Scatec Solar will deliver Engineering, Procurement and Construction (EPC) services, as well as Operation and Maintenance (O&M) and Asset Management services to the power plant.

Oumar Seydi, IFC director for Sub-Saharan Africa, said: “IFC is committed to bridging Africa’s infrastructure gap while promoting clean energy. This project is in one of the least developed provinces of Mozambique. It will diversify the country’s power generation mix and help increase access to electricity. By supporting projects like Mocuba, IFC, EAIF and PIDG are helping to encourage the participation of other private investors in Mozambique’s power sector.”

EDM’s chairman and CEO, Dr Mateus Magala, added: “EDM is very pleased that the Mocuba Solar IPP project has reached financial close through a well-structured public-private partnership between EDM, Scatec Solar and Norfund, and with excellent support from IFC and EAIF as lenders, as well as the Government of Norway.

“Experiences gained with the Mocuba project is invaluable in shaping Mozambique’s renewable energy future.”

Source: PV Tech

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