AfDB advances Africa’s hydroelectric expansion

4 May 2023
AfDB advances Africa’s hydroelectric expansion

New projects in Ivory Coast, Tanzania show Abidjan-based development bank devoted to building large hydropower across continent, accelerating build up of renewable power to match enormous potential; anchoring multi-lender arrangements

Improving hydropower capacity across the continent is a key part of the African Development Bank’s (AfDB) energy policy. The Bank’s ‘Green New Deal on Energy’ acknowledges that despite the African continent having a hydroelectric potential of 350 GW, only about 11 percent has been exploited.

Recently, the bank supported the development of the first private sector-financed hydropower project in West Africa and reached financial agreements for a new plant in Tanzania. These activities tie into the Bank’s initiatives to improve hydropower capacity via the development of new plants and the rehabilitation of the continent's older hydroelectric fleets.

Tanzania: AfDB, EU, France invest $300 million in hydropower project

The government of Tanzania, the AfDB, the French Development Agency (AFD), and the European Union (EU) in March reached an agreement for development project loans worth about $300 million.

This funding will finance the construction of the 87.8MW Kakono Hydropower Plant located in the Kagera region in the northern part of Tanzania. The AfDB is providing a $161.47m soft loan, the AFD a €110m soft loan, and the EU a €36m grant.

The hydropower plant project will be implemented by Tanzania’s Electric Supply Company (TANESCO). When completed, the plant will supply energy to about 4 million people, including small-medium enterprises, and mining companies located in the northwestern part of the country.

Part of the funds will finance the upgrading of the existing Kyaka substation, the construction of a new 39km 220kV transmission line, and support capacity-building efforts for the utility company TANESCO.   

Côte d'Ivoire: West Africa’s first private sector-financed hydropower plant nears completion

According to a report from the AfDB last month, the Singrobo-Ahouaty hydropower plant project in Côte d'Ivoire has achieved a 78% completion rate. The plant, located about 150km from Abidjan, is the first private sector-funded hydropower plant in West Africa and is being financed by a mix of debt and equity.

The AfDB Group is co-financing the €174.3m project with a €40m loan. Other financiers include the Africa Finance Corporation; Moroccan private equity firm, Neo Themis; Ivorian investment firm, IHE Holdings; German private sector development agency, DEG - Deutsche Investitions und Entwicklungsgesellschaft; and the Emerging Africa Infrastructure Fund.

According to AfDB, the plant’s cofferdams and the sluice gates for closing the dam are currently being installed, and the construction of the spillway and the tailrace – including digging one million cubic meters into the rock and pouring 85,000 cubic meters of concrete – is currently ongoing.

“All civil engineering and hydro-mechanical works are in the final stages.

“At the end of this stage, we will have the commissioning process, the start-up tests, and ultimately power generation,” Christophe Blairon, CEO of IHE, the Ivorian investment company and project implementing partner, said in March during a visit by the local state authority.

Mr. Blairon added that the filling of the reservoir is slated for early August with commissioning planned for the first quarter of 2024.

When completed the plant will supply about 100,000 households with clean energy. The plant will make an important contribution to the Ivorian government’s target to generate 42% of its electricity from renewable sources by 2030.

Energy & Utilities reported in March that AfDB approved final lending for a large renewables project in Ghana's Volta Lake region. E&U also reported on AfDB's assessment that Ethiopia is making progress in its energy sector, with 10 GW currently underway including the 5.15 GW Grand Ethiopian Renaissance Dam.

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