Regional Rusumo Falls Hydropower and Multipurpose Project

Client: Nile Basin Initiative NELSAP Coordination Unit.

Project Manager: Don Webster

In September 2007, a Director of PPA was appointed as Transaction Advisor to the Nile Equatorial Lakes Subsidiary Action Program (NELSAP) for the development of the Regional Rusumo Falls Hydroelectric and Multipurpose Project (RRFP). Whilst the Nile Basin Initiative (NBI) is a partnership of the riparian states of the Nile, seeking to develop the river basin resources in a cooperative manner, NELSAP is a subsidiary of NBI that focuses on the riparian states in the Nile Equatorial Lakes Region. Within the framework of the NBI, the governments of Burundi, Rwanda and Tanzania have received financial support from various donors for the preparation of the RRFP, which earlier studies had identified as one of the best evaluated options. The RRFP will have a capacity of approximately 60 MW and will supply power to the utilities in each of the partner states. Consequently, the project will consist of a dam and power station, straddling the border between Rwanda and Tanzania, at the Rusumo Falls, and associated transmission lines to interconnect with the networks in each partners system. In addition, the project will also comprise rural electrification for multi-purpose development in growth centres in the project area. In these areas, load growth will be actively promoted through productive investments in both the public and private domains, and provision of micro-grants or links to other financing sources to ensure active use of the supplied electricity for rural economic growth. The role of the Transaction Advisor is to support the RRFP Project Manager, and to advise the Project Implementation Committee (PIC) on issues relating to institutional frameworks, required legal arrangements, financial structures and implementation arrangements.

Description of Services Provided:

The role of the Transaction Advisor is to support the RRFP Project Manager, and to advise the Project Implementation Committee (PIC) on issues relating to institutional frameworks, required legal arrangements, financial structures and implementation arrangements. In order for the PIC to choose between a public-private partnership (PPP) and purely public financing arrangements, an early activity for the Transaction Advisor will be to determine the level and scope of private sector interest in entering into a PPP with the three governments to implement the RRFP. The Transaction Advisor will subsequently advise the Project Manager and the PIC on key aspects of the procurement process, through to financial closure, and will also produce documented research and analysis to support all stages of the decision-making process. This analysis is expected to cover the following areas: Institutional frameworks; Financing structures;Implementation arrangements; and Risk analyses and risk mitigation measures.