The Electrification Finance Initiative (EDFI ElectriFI), the Renewable Energy Performance Platform (REPP) and OnePower (1PWR) have closed the financing of a dedicated electrification facility in Lesotho. This special vehicle will electrify 11 rural communities.
The rate of access to electricity in rural areas of Lesotho should increase in the coming months. This will be thanks to the Sotho Minigrid Portfolio SPV, a special vehicle set up by electricity access provider OnePower (1PWR), the European Union (EU)-funded Electrification Finance Initiative (EDFI ElectriFI) and the UK government-funded Renewable Energy Performance Platform (REPP) managed by Camco Clean Energy.
The two investors in the 1PWR-managed solar mini-grid financing vehicle are each providing 75 million loti (approximately €4.4 million) in equity and senior debt financing. Sotho Minigrid Portfolio SPV also receives support from the U.S. Agency for International Development (USAID) under the Power Africa Initiative, the Energy and Environment Partnership Trust Fund (EEP Africa), UK Aid through the Transforming Energy Access program, as well as grants from the United Nations Capital Development Fund (UNCDF) and the United Nations Development Program (UNDP).
Electrifying 20,000 people
Funding for this project will provide 11 rural communities in Lesotho with solar photovoltaic mini-grids connected to battery storage systems. These installations will have a combined capacity of 1.8 MWp, or 3,480 MWh per year, and will be equipped with mini-grids capable of connecting 7,300 households, as well as small businesses and utilities.
Sotho Minigrid Portfolio SPV will sell the kWh of electricity at 5 loti ($0.33). “This investment is an excellent opportunity for EDFI ElectriFI to support OnePower in its mission to provide stable electricity to more than 20,000 citizens, but also to seven health centers in Lesotho,” said Quentin De Hoe, Senior Investment Officer of ElectriFI at EDFI Management Company.
The new special purpose vehicle will also create 100 jobs during the construction phase and six during the operation of the solar photovoltaic mini-grids. These installations are expected to avoid emissions of 2,780 tons of CO2 equivalent per year.
These green mini-grids will help raise the level of electrification in Lesotho. In this southern African kingdom landlocked in the territory of South Africa, 62% of the population (2,142 million in 2020 according to the World Bank) still does not have access to electricity according to REPP. The situation is more complicated in rural areas where the rate of access to electricity is only 20%. Sotho Minigrid Portfolio SPV will also implement its project with the support of GET.invest, a program set up by the EU and several of its member countries to support investments in decentralized renewable energy.
Jean Marie Takouleu