The Programme de Promotion des Investissements Privés dans le secteur des Energies Solaires (PPIPS) targets the 6 UEMOA countries least advanced in terms of access to energy: Benin, Burkina Faso, Guinea-Bissau, Mali, Niger and Togo. Its aim is to create a favorable framework for private investment in the solar energy sector, by removing the financial and technical barriers that stand in the way. The PPIPS represents a total investment of nearly 165 billion FCFA, to which BOAD is contributing 40 billion FCFA. This climate program for the private sector will help avoid the emission of 4.8 million tonnes of CO2 equivalent (TCO2eq), thus contributing to the implementation of the Nationally Determined Contributions (NDCs) of our member states.
Energy insecurity in West Africa
In West Africa, almost half the population has no access to electricity. The six (06) countries targeted by PPIPS face real energy insecurity due to low production and heavy dependence on fossil fuels, which result in high electricity costs. This situation has a negative impact on the region’s sustainable development process.
The public authorities alone are unable to alleviate all the problems arising from this situation, as they do not have sufficient and appropriate financial resources. There is therefore an urgent need to attract private investors to strengthen and diversify clean power generation in the region.
The benefits of solar energy
One of the main advantages of solar energy, compared with fossil fuels, is its inexhaustible nature. But this renewable energy also has the merit of having one of the best carbon footprints. In fact, solar energy emits almost no C02 into the atmosphere, so it makes virtually no contribution to global warming. Only the production of solar panels and the manufacture of batteries involve industrial processes that emit CO2. The total greenhouse gas emissions generated over the life cycle of solar power are still 96% lower than for coal, and 93% lower than for gas.
In addition to its ecological benefits, solar energy is also a way of saving money. Contrary to popular belief, its cost has fallen by 96%* between 2000 and 2019. Solar installations generally pay for themselves after 13 years, and have a lifespan of 30 years, so they can save the equivalent of 17 years’ electricity consumption.
PPIPS, a mixed financing approach
PPIPS capitalizes on the solar energy production potential of target countries by providing private sector players with technical support (training, awareness-raising, marketing) and financial support (direct concessional loans). The increase in private investment in solar energy supported by the program is based on an innovative financing approach thataims to mitigate the risks of both entrepreneurs and financiers.
The total cost of the program is 164.958 billion FCFA. It is financed by the Green Climate Fund to the tune of 40.014 billion (37.390 billion concessional loan and 2.624 billion grant); BOAD provides CFAF 40 billion in co-financing To complete the financing, local financial institutions and the private sector will contribute 83.963 billion euros, or 50% of the total cost of the project.
Solar capacity of 1,192 MW by 2030
At the start of the program, solar energy represented only 5% of the region’s energy mix. By the end of the project, the target countries should have quadrupled their solar energy production capacity. The aim is to reach a capacity of 1,192 MW by 2030. This will reduce these countries’ dependence on fossil fuels and boost solar energy’s role in the region’s energy mix.
*Source: Triangle Energie
**Photo credit: Photo by Jeremy Bezanger on Unsplash