The Sustainable Energy Fund for Africa (SEFA) which is managed by the African Development Bank (AFDB) recently approved a USD 995K grant to support the rollout of a sustainable procurement framework for Independent Power Producers (IPPs) in Ethiopia.
The goal of the grant is to encourage private investments into hydropower projects through Ethiopia’s Renewable Energy Programme.
SEFA is a multi-donor facility established to unlock private sector investments in small to medium-sized clean energy projects in Africa through grants, equity investments and support for the public sector.
The SEFA grant will strengthen the government’s capacity to undertake bankability and technical analysis, including feasibility assessments of projects in the hydro priority pipeline. In addition, it provides for environmental and social impact assessments, resettlement action plans, and preparation of bidding documents for hydro projects.
Wale Shonibare, the Bank’s acting Vice President for Power, Energy, Climate Change and Green Growth said, “a well-structured procurement framework is crucial in mobilizing the investments necessary to achieve universal energy access in Africa.” Adding that the SEFA program will boost private IPPs participation, and spur investments into the Ethiopian hydro power sector.
Ethiopia has a vast but untapped renewable energy potential. It is one of the few countries in the world which generates almost all the electricity from renewable resources, mostly hydropower. The country also has vast and mainly untapped solar, wind, and geothermal energy resources.
Under a long-term strategy aimed at transforming the country into a regional energy hub by 2030, Ethiopia has outlined a National Electrification Program (NEP), targeting universal access by 2025 through a 65 percent on-grid, and 35 percent off grid combination.
The Ethiopia Renewable Energy Program, supported by the SEFA grant, is in line with the country’s Growth and Transformation Plan (GTP II) 2015/16 – 2019/20 and with the NEP targets. It also aligns with the Bank’s Energy Sector Policy (2012), the New Deal on Energy for Africa, especially focusing on “Renewable Energy” and “Early Stage Project Finance”.
Featured Image Courtesy: ESI-East Africa.com