Dutch development bank FMO has arranged a $14.7-million senior loan for the financing of the Tororo solar photovoltaic (PV) project in Uganda.
The plant is owned by multinational corporation Building Energy, which has experience in developing more than 2 000 MW of renewable-energy projects in Africa.
Building Energy will build and operate the power plant.
FMO acted as mandated lead arranger of the $14.7-million facility, 50% of which was syndicated to the Emerging Africa Infrastructure Fund.
“FMO is proud to support this renewable-energy project in Uganda. We aim to make a difference in people’s lives in a country where electricity is not always reliable and are therefore pleased to work with investors who are committed to renewable solutions,” says FMO CIO Linda Broekhuizen.
Uganda has one of the lowest electricity consumption per capita rates in the world, with an average electrification rate of 18.2%. The country’s power sector suffers from a shortage of generation capacity and a lack of reliable and affordable electricity is hindering more sustainable economic growth.
The project is developed under a dedicated support scheme for renewable-energy projects managed by Germany’s KfW Bankengruppe in partnership with Uganda’s government.
It is funded by the European Union Infrastructure Trust Fund, and is also supported by the governments of Norway, Germany and the UK.
“We are pleased with the closing of this agreement, which demonstrates Building Energy’s commitment to the African market. The plant will support Uganda’s energy needs, creating, in the meantime, new jobs, which will enable the local communities to take part in the development of the country,” says Building Energy MD Matteo Brambilla.