ATI Supports the 20 MW Golomoti Solar Power Plant in Malawi with its Regional Liquidity Support Facility (RLSF)
ATI (www.ATI-aca.org) has supported the Golomoti solar PV, a 20 MW solar PV power plant in Malawi, by providing liquidity cover via the Regional Liquidity Support Facility (RLSF); RLSF was created to help tackle climate change and attract additional investments by supporting renewable energy projects in ATI’s member countries; Golomoti Solar becomes the fourth project to benefit from RLSF Cover. Cumulatively, RLSF has enabled projects with a total installed capacity of 108.5 MW to reach financial close.
In line with its strategy to address the gap in Africa’s renewable energy sector, the African Trade Insurance Agency (ATI) has supported the financing of the Golomoti solar PV, a 20 MW solar power plant in Malawi. This is the fourth project to benefit from the Regional Liquidity Support Facility (RLSF) since the launch of the facility.
RLSF, an initiative launched in 2017 by ATI and KfW Development Bank, was created to help tackle climate change and attract additional investments by supporting renewable energy projects in ATI’s member countries. It is designed to address short-term liquidity risks faced by Independent Power Producer (IPPs) that sell electricity to state owned power utilities across sub-Saharan Africa. RLSF provides cash collateral supplemented by on-demand guarantees to a bank that in turn issues a revolving standby letter of credit for the benefit of the IPP – the SBLC is available for drawdowns following a payment delay by the offtaker.
In addition to Golomoti Solar, RLSF has enabled projects with a total installed capacity of 108.5 MW to achieve financial close – a key milestone as the projects get closer to connecting to the grid. The other projects that have benefited from RLSF cover are the 7.5 MW Mubuga solar PV in Burundi (https://bit.ly/3IJZfWB), the 21 MW Nkhotakota (https://bit.ly/3lZSDJK) and 60 MW Salima solar PVs (https://bit.ly/31PDPqr) in Malawi.
Golomoti Solar was jointly developed by JCM Power Corporation, a Canadian clean energy IPP and InfraCo Africa Limited, part of the Private Infrastructure Development Group (PIDG). Construction funding was provided by JCM Power and InfraCo Africa. The electricity generated by the power plant will be sold exclusively to the Malawian national power utility, ESCOM, under the terms of a 20 year Power Purchase Agreement (PPA).
With support from Innovate UK, Golomoti Solar will include a 5MWh battery energy storage system (BESS) – the first commercial-scale solar PV plant in Malawi to include battery storage. In addition to contributing towards the increased generation of electricity and creation of employment, the project will further diversify Malawi’s energy mix as it introduces an alternative to the hydro and diesel powered projects that currently supply the bulk of the country’s electricity. The project has benefited from knowledge-sharing with its sister project, Salima Solar, with both projects being beneficiaries of the evolving regulatory framework within Malawi that has made it possible for the advancement of such renewable energy projects.
Quote from Obbie Banda, Underwriter responsible for ATI’s Renewable Energy Sector Initiatives and Portfolio
“We are pleased to be supporting yet another renewable energy project in Malawi with RLSF cover. Special thanks to JCM Power and InfraCo Africa who have allowed us to contribute towards their two projects within the country. Evidently, the sector reforms introduced by the Malawian government in recent years are bearing fruit – we hope to continue being a part of this positive journey in future, not only in Malawi but across the African continent with the view of making a contribution towards a Just Energy Transition”
Quote from Christian Wray, CEO of JCM Power
“Support from ATI through the RLSF initiative has been a key aspect of advancing our projects in Malawi. The partnership makes it possible for IPPs like JCM Power to deliver projects that have a positive impact on the renewable energy sector in Africa.”
Quote from InfraCo Africa’s Head of Asset Management, Connor Dawson
“Our recently inaugurated 60MW Salima Solar plant has benefited from a revolving liquidity guarantee provided by ATI, under its Regional Liquidity Support Facility, and we are pleased to have ATI’s support for Golomoti Solar, our second solar initiative in Malawi. This support will ensure that Golomoti can deliver reliable access to clean electricity for homes and businesses, powering Malawi’s future economic growth.”
Distributed by APO Group on behalf of African Trade Insurance Agency (ATI).
African Trade Insurance Agency
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About The African Trade Insurance Agency:
ATI was founded in 2001 by African States to cover trade and investment risks of companies doing business in Africa. ATI predominantly provides Political Risk, Credit Insurance and, Surety Insurance. In 2020, ATI closed the year with a gross exposure of US$6.3 billion and a net profit of US$39.4 million, owing to a strong demand for ATI’s insurance solutions from the international financial sector and from African governments. Since inception, ATI has supported US$70 billion worth of investments and trade into Africa. For over a decade, ATI has maintained an ‘A/Stable’ rating for Financial Strength and Counterparty Credit by Standard & Poor’s, and in 2019, ATI obtained an A3/Stable rating from Moody’s.
About The Regional Liquidity Support Facility (RLSF):
ATI and the German Development Bank, KfW, with financing from the German Federal Ministry for Economic Cooperation and Development (BMZ), launched the RLSF in 2017. The Facility was created to help tackle climate change and attract investments by supporting renewable energy projects in ATI’s member countries. RLSF has an initial capacity of EUR 63.2 million and it supports small and mid-scale renewable energy projects with an installed capacity of up to 50 MW (and in exceptional cases up to 100 MW) by protecting the developers against the risk of delayed payments by public off-takers; in turn improving project bankability and ensuring that more projects reach financial close.
About JCM Power:
JCM Power is an independent power producer (IPP) dedicated to accelerating social, economic and environmental sustainability in growth markets through the development, construction and operation of renewable energy infrastructure. Our driving vision is to advance the clean energy age. For more information, please visit:
About The Private Infrastructure Development Group (PIDG):
PIDG is an innovative infrastructure project developer and investor which mobilises private investment in sustainable and inclusive infrastructure in sub-Saharan Africa and south and south-east Asia. PIDG investments promote socio-economic development within a just transition to net zero emissions, combat poverty and contribute to the Sustainable Development Goals (SDGs). PIDG delivers its ambition in line with its values of opportunity, accountability, safety, integrity and impact. Since 2002, PIDG has supported 171 infrastructure projects to financial close which provided an estimated 217 million people with access to new or improved infrastructure. PIDG is funded by the governments of the United Kingdom, the Netherlands, Switzerland, Australia, Sweden, Germany and the IFC.
About InfraCo Africa :
InfraCo Africa is part of the Private Infrastructure Development Group (PIDG). InfraCo Africa seeks to alleviate poverty by mobilising private investment into high-quality infrastructure projects in sub-Saharan Africa’s poorest countries. It addresses the risks and costs of early-stage project development: funding teams of experienced developers and providing risk capital to those projects which need the financial commitment and leverage that InfraCo Africa can bring. InfraCo Africa is funded by the governments of the United Kingdom (through FCDO), the Netherlands (through DGIS) and Switzerland (through SECO).