Development finance organisation the Emerging Africa Infrastructure Fund (EAIF) has committed an €11.5-million senior secured loan to develop the first project-financed solar photovoltaic (PV) plant and battery energy storage system (BESS) in the north of Senegal.
The Walo facility will be a 10 MW or 20 MWh BESS supplied by a 16 MW solar PV plant.
Upon completion, Walo will improve energy security in the country, demonstrating the importance of robust energy storage systems to support the electric transmission network and accelerate an efficient transition to renewable energy.
US government foreign aid agency Millenium Challenge Corporation recommended the installation of at least 80 MW of battery storage, with Walo as one of the first in a series of projects.
Renewable energy company Africa REN will build and operate the facility under a 20-year power purchase agreement designed to solve issues associated with intermittent energy supply, which is a key challenge of integrating renewable energy into the grid, the EAIF said.
“Within six years, Senegal has added more than 345 MW of clean power, accounting for nearly one-quarter of its energy mix. This is a concrete example of the impact of policy implementation prioritising progress towards net-zero and accelerating energy access to above 70%, which is the twelfth highest in Africa,” the EAIF said.
Greater certainty in power supply has acted as a key catalyst of rapid industrialisation across the country. The value of output from the sector has increased by one-third, while its contribution to gross domestic product simultaneously has fallen as Senegal’s economy is rapidly diversifying and modernising.
“Walo will deepen Senegal’s economic importance to the region and highlight its ability to implement transformative technology. The first-of-its-kind project will deliver a range of positive impacts, including greater flexibility in energy management and improved reliability of grid operations.”
The system will use reserve energy when there are deficits, bring power and grid assets online after failures, and supply electricity to the cities in the northern part of Senegal during power outages.
Beyond energy access and reliability of supply, Walo will also boost the local economy through the creation of 150 jobs during construction as well as 20 permanent roles when in operation.
“Our investment in Walo is a sign of our confidence in Senegal’s rapidly growing energy sector. We are backing the introduction of innovative renewable energy technology as part of our broader commitment to prioritising investment opportunities with a transformational impact and strong potential for replicability,” said asset management group Ninety One director and EAIF fund manager Tidiane Doucoure.
EAIF acted as co-lender alongside the Dutch development bank FMO to support the development of the €42-million landmark project.
A euro equivalent $1.5-million capital grant extended by Private Infrastructure Development Group (PIDG) Technical Assistance will ensure the project is designed to maximise supply of clean power to Senegal’s grid, while remaining economically viable. The EAIF is a PIDG company.