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Add to Preferred SourcesA hydro-powered electricity plant capable of powering Uganda’s national grid has received a joint loan of US$29.3 million from the Emerging Africa Infrastructure Fund and Dutch development bank FMO.
The parties each contributed 50 percent to the facility, which will be used to refinance a 13-megawatt Bugoye hydro-electric power plant in Western Uganda. Nicholas Tatrallyay, investment manager at Berkeley Energy, a firm that manages the energy fund, said:
“The Bugoye refinancing will allow the Africa Renewable Energy Fund to invest additional capital into Uganda and further expand its portfolio of hydro projects in the country.”
Proceeds from the project will be used to pay back the project’s original debt to the Emerging Africa Infrastructure Fund, as well as cover maintenance costs and the repayment of construction loans from Africa Renewable Energy Fund, the project’s sponsor and sole shareholder in Bugoye. The Emerging Africa Infrastructure Fund was the mandated lead arranger via Investec Asset Management. Together these facilities will account for up to 39 percent of Uganda’s installed generating capacity.
David White, chairman of the infrastructure fund, told Development Finance the project exemplifies the potential of private sector investment to create impactful clean energy projects in Africa.
“There’s no shortage of private money. What is short is good quality, viable, projects proposed by high quality investors and management teams,” David White, chairman of the infrastructure fund.
According to White, the key to attracting private capital is demonstrating stability.
“Where there is greater political, social and economic stability private money will be attracted, whether it’s African or international in origin. EAIF is about stimulating economies to help get them to the stage where private capital is able to push out public capital.”
Original source: DevFin.
Posted on 27 July 2017.