The African Trade Insurance Agency (ACA) has just guaranteed $67 million investments in the Nkhotakota solar photovoltaic project in central Malawi. It is being developed by a consortium formed by responsibility Renewable Energy Holding (RAREH) and Phanes Group and is expected to have a capacity of 37 MWp.
News on the Nkhotakota solar photovoltaic project in Malawi. It has just received a guarantee from the African Trade Insurance Agency (ACA). The US$67 million guarantee is issued under the Regional Liquidity Support Facility (RLSF), a facility that provides short-term liquidity support to Independent Power Producers (IPPs).
The purpose is to cover the risk of late payment by national electricity companies. “The Nkhotakota solar power plant is part of the government of Malawi’s action plan to reduce the country’s dependence on hydropower, which currently accounts for more than 90 per cent of its electricity production. Indeed, hydropower makes the country vulnerable to frequent power cuts that often occur in times of drought. The solar power plant aims to provide a more sustainable solution for access to stable and reliable electricity,” explains ACA.
Clean electricity for 150,000 households
The Nkhotakota solar project is being developed by a consortium formed by responsibility Renewable Energy Holding (RAREH), a Kenyan-based investment company, and the UAE-based Phanes Group IPP. The solar power plant will be built in two phases, the first of which will have a production capacity of 21 MWp. The second part of the project in central Malawi will produce 16 MWp.
The 37 MWp facility will be covered by a Power Purchase Agreement (PPA) signed between its two owners and the state-owned Electricity Supply Corporation of Malawi (ESCOM). Under the terms of the agreement, ESCOM will purchase the power over a period of 20 years. The developers of the project estimate that the future solar power plant will be able to provide electricity to 150,000 Malawian households.
The clean energy project is being supported by the American Development Finance Corporation (DFC), a new agency created by the merger of the Overseas Private Investment Corporation (Opic) and the Development Credit Authority (DCA).
Jean Marie Takouleu