African Development Bank commits $3 billion to Power African
At the recent US-African Leaders Summit, the African Development Bank reaffirms commitment of $3 billion for Power Africa over a five-year period
As part of the US-African Leaders Summit, on Tuesday, August 5, 2014, African Development Bank (AfDB) Group President, Donald Kaberuka, reaffirmed the AfDB’s support to advance the Power Africa initiative, with a commitment of $3 billion over a 5-year period. This support was originally announced by the AfDB, as an anchor Power Africa partner on the continent, in July 2013. In 2013 only, AfDB interventions related to focus countries (Ethiopia, Ghana, Kenya, Liberia, Nigeria and Tanzania) amounted to over $600 million.
Under the enhanced partnership announced Tuesday, the United States and AfDB will collaborate on scaling up the use of off-grid and mini-grid technologies, supporting geothermal power development, and strengthening regional power trading between African countries among others. Over the next year, the AfDB expects to commit around a billion dollars in support of energy projects in Ethiopia, Ghana, Kenya, Liberia, Nigeria, and Tanzania, the six Power Africa focus countries. Once implemented, these operations would contribute towards 5-10% of the stated Power Africa goal of developing 10,000 megawatts of new power generation in Sub-Saharan Africa.
The AfDB supports far-reaching power sector reforms and provides technical assistance, financing and guarantees for power generation, transmission and distribution projects in Africa. The AfDB Group – including the concessional lending window African Development Fund (ADF), to which the United States contributes – works directly with governments and private investors to advance critical reforms needed to attract public and private financing and build the capacity in Africa’s power sector. AfDB commitments to Africa’s energy sector currently total over $12 billion, and are projected to increase by $2 billion in the coming year.
Examples of joint activities under the anchor partnership include:
- the launch in March 2014 of the Africa Renewable Energy Fund (AREF), a fund which is expected to significantly invest in Power Africa focus countries and which is co-sponsored by the Sustainable Energy Fund for Africa (SEFA), a multi-donor trust fund administered by the AfDB and to which the US made a $20 million multi-year contribution;
- advisory services to the Government of Ethiopia regarding negotiations of the Power Purchase Agreement for the 1,000 MW Corbetti Geothermal Project, the largest geothermal facility in Africa, through the African Legal Support Facility (housed at the AfDB) to which the US has provided a $3 million grant;
- assistance to the Government of Ghana for the preparation of its Sustainable Energy for All (SE4ALL) Action Agenda, which complements the work being done by the US on the development of the country’s SE4ALL Investment Prospectus;
- lead arranger for the 300 MW Lake Turkana Wind Project in Kenya, for which the US is providing capacity building to the utility company to enable proper integration of wind energy into the grid;
- in Liberia, collaboration with the US and other partners on the Scaling-Up Renewable Energy Program (SREP), which focuses on mini-grids and stand-alone renewable energy services;
- support to Nigeria’s power sector privatization program through the provision of financing, risk guarantees, and capacity building; and
- assistance to the Tanzanian Government to implement their power sector reforms and develop renewable energy projects using public-private partnerships.
Source: News Release by The African Development Bank Group