$19 million Uganda solar plant will power 40,000 homes and businesses
SOROTI, Uganda, March 17, 2016 /PRNewswire/ — Today, representation from the Ugandan Ministry of Energy, joined sustainable energy investors and developers EREN Renewable Energy (“EREN RE”) and Access Power to celebrate the start of East Africa’s largest solar project, based in Soroti, Uganda. They were joined by the European Union and Netherlands Ambassadors to Uganda, representatives from German and Dutch development banks KfW and FMO, and local dignitaries.
The 10 megawatt (MW), US$19 million solar photovoltaic plant is owned and operated by Access Uganda Solar Ltd, a partnership between EREN RE and Access Power. The plant is expected to be operational and connected to the national grid in July 2016, providing clean, low-carbon, sustainable electricity to 40,000 homes and businesses. It is also the largest privately-funded solar power plant in Sub-Saharan Africa, outside of South Africa.
Reda El Chaar, Executive Chairman of Access, commented: “Breaking ground today marks a major milestone for Access Power and its shareholder EREN RE, for Uganda and for the development of Africa. Only by working together can we effect real change and answer the urgent need for electrification of so many. Our company brings innovation, expertise and determination to every project we work on and we are particularly proud of Soroti and proud of everyone involved”.
Christophe Fleurence, Vice-President of Business Development – Africa of EREN RE, declared: “We are glad to launch the construction of the first project co-developed on the African continent with our partner Access Power, especially as part of such a promising and well-thought out scheme. The extensive political and international support to this project, unprecedented in Uganda and in the region, demonstrated again at the occasion of the ground breaking ceremony, underlines the broad willingness to shift boundaries in electricity generation. EREN RE which is a renewable energy investor and a long-term independent power producer, is determined to switch light on in many other places in Africa and emerging markets more generally, as efficiently as it was achieved at Soroti.”
Spain’s TSK Group has been awarded the engineering, procurement and construction (EPC) contract and will sub-contract parts of the work to local firms. Local labour is being hired for the construction phase and the developers will also recruit and train engineers to operate the plant.
The project was financed by a mix of debt and equity with the senior debt facility being provided by FMO, the Netherlands development bank, and the Emerging Africa Infrastructure Fund (EAIF). The project reached financial close in record time, providing a successful and easily replicable case study of fast-track implementation of a renewable energy generation project conducted by private developers in Africa.
Today’s ceremony took place at the solar plant site in Soroti, 300 kilometres northeast of the Ugandan capital Kampala. It was attended by local community chiefs as well as national dignitaries and concluded with the symbolic breaking of soil and subsequent laying of the foundation stone, followed by closing speeches.
Following the opening address from Stephane Bontemps, Board Director, Access Power attendees were given a full update on the construction timeline of the plant. Next, guests heard from KfW bank regarding the GET FiT Facility, a dedicated support scheme for renewable energy projects. The Soroti project is the first solar power plant to be successfully developed under the GET FiT scheme, in partnership with the Government of Uganda through the country’s Electricity Regulatory Agency (ERA). It is funded by the European Union Infrastructure Trust Fund, and supported by the governments of Germany, Norway and the United Kingdom.
H.E. Ambassador Kristian Schmidt, European Union Head of Delegation to Uganda said: “Uganda is a good place to invest in solar energy. The regulatory framework is conducive and Government rightly recognises Uganda’s energy future must be renewable. It is great that this is now triggering private sector interest in solar power generation. The European Union is proud that our Euro 8.7m grant contribution ensures the realisation of the Soroti Solar Plant, and I hope this is only just the beginning for many more to come.”
Kathrin Kästle, Senior Project Manager (Energy), KfW said; “KfW is very pleased to witness the launch of the first solar project under the GET FiT programme. We believe it will be an important addition to diversifying the energy mix in Uganda and creating more generation capacity in a very short time frame.”
Notes to Editors:
Access Power: Stephane Bontemps, Board Director; Giorgio Borgia, Director, Operations
EREN RE: Christophe Fleurence, Head of Business Development Africa
Ministry of Energy, Uganda
Ambassador of EU to Uganda: H.E. Mr. Kristian Schmidt
Ambassador of the Netherlands to Uganda: H.E. Mr. Alphons Hennekens
KfW bank: Kathrin Kastle
FMO bank: Wilfred van den Bos
District & County officials
– The project is owned and will be operated by Access Uganda Solar Ltd, a partnership between EREN Renewable Energy and Access Power.
– The tender was launched in March 2014 and the procurement process managed by Germany’s KfW Development Bank.
– The tender was awarded to Access Uganda Solar Ltd in Nov 2014.
– Environmental and social impact assessments (ESIAs) in line with the International Finance Corporation (IFC) Performance Standards, the most comprehensive and detailed in the world were conducted.
– All the necessary approvals and permits were received from local, regional and national authorities in Uganda.
– The 20-year Power Purchase Agreement (PPA) was signed in 2015.
– The PPA is with the Uganda Electricity Transmission Company Ltd (UETCL), the state-owned utility company.
– The project reached financial close on 20th January 2016.
– Uganda currently has about 800MW of installed electric capacity, mostly from hydro and thermal sources, and has an 18.2 percent electrification rate, according to the World Bank.
The location of the solar plant was chosen due to the region’s low power generation capacity and the need to reduce transmission losses. The first grid-connected solar plant in Uganda, Soroti will make a significant contribution to increasing electrification rates in the region, which enjoys some of the highest levels of solar resources in the country. In addition, with a design life of 30 years, the plant has the capacity to expand as its sub-station is able to handle a further 20MW of solar energy.
Current power generation in the region is intermittent, especially during the summer months, with extensive load shedding of up to four hours a day. Only homes and businesses in the town of Soroti itself have access to the grid but more than 80 percent in the region have none. This has impeded economic development in the area and also has an impact on the quality of life.
About Access Power
Access Power was founded in 2012 by Mr. Reda El Chaar with the aim of structuring, developing, and investing in renewable energy projects in frontier markets. Access has assembled a development team with a track record of financially closing around 30GW of power projects across the globe, with a specific focus on the MEA region. Access is currently developing renewable energy projects worth more than US$1 billion in 17 African countries, and has now expanded its reach to the Central Asian sub-continent.
For more information: www.access-power.com.
About EREN RE
EREN RE, member of EREN Groupe, was founded in 2012 by Pâris Mouratoglou and David Corchia, both with significant experience in the renewable energy sector. EREN Groupe is the first group dedicated to natural resource efficiency. The Group promotes and invests in technological innovations in the water, basic materials and energy sectors. EREN RE develops projects in countries where renewable energy provides an economically viable response to growing power demand. Through partnerships established with local developers, EREN RE has accumulated a portfolio of 240 MW (net) of renewable energy assets in operation and under construction, and over 1.5 GW of assets under development.
For more information: www.eren-groupe.com