Multinational independent power producer Building Energy on Wednesday said it could proceed with the construction of the 10 MW Tororo solar photovoltaic (PV) project in Uganda, as it reached financial close with Dutch development bank FMO for $14.7-million.
The project’s shareholders will contribute an additional $4.9-million in equity.
Construction of the 14 GWh/y project started on December 14 and will last about seven months. The plant is majority owned by Building Energy, which will be responsible for its construction and operation and which is also engineering, procurement and construction contractor and operation and maintenance contractor for this project.
Uganda has among the lowest electricity consumption per capita in the world, with an electrification rate of 18.2%. The country’s power sector suffers from a shortage of generating capacity and a lack of reliable and affordable electricity is hindering more sustainable economic growth.
In this scenario, the project will also contribute to the socioeconomic development of the Tororo area in eastern Uganda, where it is located.
Additionally, it will create 250 jobs during the construction phase, and eight local jobs during operation. The solar plant will serve the equivalent of 36 200 people through generation and has an yearly avoided greenhouse gas rate of 7 400 t carbon dioxide equivalent.
It is the first Ugandan project promoted by the government in the renewable energy sector, developed under the KfW led GET FiT facility, which is a dedicated support scheme for renewable energy projects.
This is managed by Germany’s KfW Bankengruppe in partnership with Uganda’s government through the Electricity Regulatory Agency (ERA). It is funded by the European Union Infrastructure Trust Fund, and is also supported by the governments of Norway, Germany and the UK.
Building Energy Africa MD Matteo Brambilla said this marked a strategic step to further consolidate the company’s presence in East Africa, while contributing to the socioeconomic development of Tororo region.