IRENA in collaboration with Abu Dhabi Fund for Development (ADFD) have agreed to provide $46 million in concessional loans for development of three renewable energy projects in West Africa.
The loans will fund a solar project in Burkina Faso, a solar and wind project in Cabo Verde, and a solar project in Senegal – as well as a wind and solar project in the island nation Antigua and Barbuda in the Caribbean.
IRENA and ADFD established a funding programme, Project Facility, which commits $350 million to increase the deployment of renewable energy in developing countries.
The four selected projects form a part of the third cycle, following the previously funded in cycles one and two that included solar, hydropower, geothermal, biomass, wind and hybrid projects in Argentina, Ecuador, Cuba, Iran, Maldives, Mali, Mauritania, Samoa, Sierra Leone and St. Vincent and the Grenadines.
According to a statement by IRENA, the loan will be aimed at funding solar and wind projects in west Africa and the Caribbean according to the range of renewable energy resources available to each country.
ADFD is an Abu Dhabi government institution, which assists developing countries by providing concessionary loans to finance development projects.
Poor infrastructure hinder renewables’ growth
In a joint statement, the organisations explained that these four projects will generate a capacity of nearly 12MW of new renewable energy, which will electrify rural communities, reduce carbon emissions and create jobs.
IRENA director-general Adnan Z. Amin commented: “Accelerating the energy transition to renewables requires all countries to take action to develop their own local renewable energy sources.
“While renewable energy resources are abundant in many developing countries, adequate finance can still be a barrier to deployment. IRENA and ADFD’s pioneering partnership contributes to overcoming this challenge, by selecting innovative projects for concessional funding.”
ADFD’s director-general Mohammed Saif Al Suwaidi, said: “Our collaboration with IRENA has significantly contributed to narrowing the energy divide that has long hindered development projects in developing countries due to the lack of reliable power infrastructure.
“Through this collaboration, we have ensured the availability of necessary financial resources to move the sustainable development agenda forward.”
Third cycle projects
Burkina Faso will receive $10 million to develop a 3.6MW solar PV mini-grid project for more than 12,000 local families. The project is declared to avoid 2,500 tonnes of carbon emissions per year.
In Cape Verde, a 2MW hybrid grid-connected solar PV and wind project will receive $8 million to provide a 100% renewable energy solution for the Island of Brava, and the project is anticipated to avoid 4,665 tonnes of greenhouse gas emissions per year.
Likewise, Senegal will obtain $13 million for a 2MW solar PV mini-grid project to supply electricity to rural villages. This project will avoid 3,200 tons of CO2 per year, according to the statement.
Lastly, Antigua and Barbuda is to receive $15 million for a 4MW wind and solar project and will provide energy to purify water and increase climate resilience. The project will avoid 8,275 tonnes of CO2 per year.
The fourth funding cycle of the Project Facility is now open for project proposals until 15 February 2016, with concessional loan interest rates of 1-2% provided by ADFD.