Abu Dhabi Fund for Development (ADFD) has confirmed its provision of financing for a $18m solar park in Sierra Leone’s capital Freetown, with the body agreeing to provide $9m of the total cost in the form of a long-term, low-interest loan, as well as to directly monitor the project.
The projects was selected by the Abu Dhabi-based International Renewable Energy Agency (IRENA) and ADFD as part of pledge by the latter to provide loans worth $350m for renewable energy projects within a scheduled seven-year cycle of loans, each worth $50m.
Sierra Leons’s solar park will be completed within 21 months and will generate sufficient power for some 3,000 households in Freetown and its suburbs. It will be constructed along the Toke-Lumley highway also partially financed to the tune of $5.4m in 2011 by ADFD.
“In order to successfully guarantee economic inclusion we need to meet the required energy generation and achieve a power mix,” said Kaifala Marah, minister for finance and planning. “This will be a flagship project not only for us, but for the whole region of West Africa.”
The contract for the engineering, procurement and construction of the project has been secured by the Sharjah, UAE-based Mulk Oasis Gulf Investment, while a separate partnership will see Abu Dhabi’s Masdar PV manufacture the photo-voltaic solar panels for the project.
Sierra Leone has an overall installed energy capacity of 96MW that falls far short of its estimated 500MW demand, but the government is targeting 25% renewable use by 2015, and is considering every option pursues domestic energy demand and a suitable climate for foreign investment.
“We believe in the importance of encouraging investment in renewable energy and that’s why we launched this initiative,” added Mohammed Saif Al Suwaidi, ADFD’s director general. “We hope to be a strong contributor to sustainable development through loans and grants.”
At present, Sierra Leone’s economy heavily depends on mining, and the country ranked 142nd out of 189 countries in the World Bank’s ‘Doing Business’ index, in which power supply dampened the country’s otherwise positive ranking for investor protection and credit access.
ADFD also signed a $5m loan agreement in May with Mauritania, for the construction of wind farms in four coastal towns that will provide over 270kW in wind power capacity, while bringing the total of loans extended by the fund to the West African country up to $80m, and Abu Dhabi recently held talks on further cooperation.
In 2013, the body signed a further $10m loan agreement with Kenya to finance an electrification project in rural areas aimed at establishing a distribution network to 591 commercial centres and 35,000 homes, and further agreements also were signed with both Guinea and Mali.
As an organisation, ADFD was established in 1971 as a vehicle to manage the UAE’s humanitarian affairs, and is currently chaired by Sheikh Mansour Bin Zayed Al Nahyan. Since its inception, the Abu Dhabi body has facilitated $4bn in loans and $3.65bn in grants.
In related news, May also witnessed a Saudi-Canadian solar JV between the Fawaz Alhokair Group and Toronto’s SkyPower Global sign a $5bn photovoltaic project with Nigeria’s federal and Delta State Government departments to develop a 3,000MW solar project.