CLIMATE FINANCE: BOAD mobilizes €96.34 million (XOF63.56 billion) from the Green Climate Fund (GCF) to support private sector investments and solar rural electrification in Least Developed Countries (LDCs) of WAEMU.
Songdo, 26 February 2019. The Board of Directors of the Green Climate Fund (GCF) at its 22nd meeting held at the headquarters of the institution in Songdo (South Korea) approved two (2) funding proposals submitted by BOAD, as a direct access accredited entity to the Fund. These are: The Program to scale-up Private Investments in the Solar Energy Sector (PPIPS) in West Africa, and the Solar Rural Electrification Project (PERS) in Mali. These operations are part of scaling-up solar photovoltaic systems for increased access to low-cost electricity for rural populations in particular, while reducing greenhouse gas (GHG) emissions. This funding confirms BOAD’s commitment to promote green energy on one hand, and on the other hand, to support efforts of its Member countries in the implementation of their Nationally Determined Contributions (NDC).
The Program for scaling-up Private Investments in the Solar Energy Sector (PPIPS) in West Africa aims at setting up technical support (training, awareness, marketing) and financial support (direct concessional loans) in favor of renewable energy (RE) and energy efficiency (EE) initiatives by private sector businesses (SMEs). The implementation of the Program will benefit about 2.9 million people in six (6) WAEMU Least Developed Countries (LDCs), including Benin, Burkina Faso, Guinea Bissau, Mali, Niger and Togo. It will also help avoid greenhouse gas emissions estimated at 4.8 million tons of CO2 equivalent. The total cost of the Program is €250 M (XOF164.958 billion). It is financed to the tune of 50% by GCF, amounting to €61 million (XOF40.013 billion) including €57 million (XOF37.390 billion) concessional loan and €4 million (XOF2.624 billion) grant. BOAD will co-finance to the tune of EUR 61 million to secure the funding arrangements, the participation of local financial institutions and the private sector in the financing of the program to the tune of €128 million (XOF83.963 billion).
The objectives of the Solar Rural Electrification Project (PERS) in Mali are to promote rural electrification of 70 communities through isolated solar photovoltaic systems, to strengthen the capacity of actors involved in rural electrification in order to accelerate solar-powered electrification, and to support access to financial services for productive energy consumers. Its implementation will benefit approximately 311,000 inhabitants in the rural areas of six (6) regions in Mali (Kayes, Koulikoro, Sikasso, Segou, Mopti and Timbuktu) and contribute to avoided greenhouse gas emissions estimated at 1.03 million tons of CO2 equivalent. The total cost of the Project is €46.2 million (XOF30.305 billion). It is financed by the GCF to the tune of €35.34 million (XOF23.182 billion) of which €25.95 million (XOF17.022 billion) for a first Tranche made up of €24.3 million (XOF15.940 billion) in the form of concessional loan and a grant of €1.65 million (XOF1.082 billion). BOAD is expected to provide a total co-financing in an amount of €10.63 million (XOF6.973 billion), of which €8.3 million (XOF5.444 billion) for Tranche 1.
The total cumulative cost of these two projects amounts to €168.2 million (XOF110.332 billion), bringing to 20 the number of renewable energy projects financed by BOAD from 2013 to date for a total amount of XOF297 billion.
The approval of these two solar energy projects echoes the high-level forum on “Solar Energy in WAEMU Economies” held on 14 and 15 November 2018 during the celebration of BOAD 45th anniversary in Lomé. It also seals the cooperation between the Bank and the Green Climate Fund which had already granted US$ 439,134 (XOF250.08 million) for the preparation of an adaptation project in Niger.
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