World Bank launches solar scheme to boost Africa’s power supply
THE World Bank Group has announced a new solar energy scheme, aimed at promoting access to modern alternative energy across the continent.
The scheme, according to a statement from the World Bank, would create a viable market for private solar power projects in Africa and further help governments to increase the supply of energy for millions of residential and commercial consumers across the continent.
“The pragramme tagged ‘Scaling Solar’ reduces the development time and uncertainty for bidders and investors, while lowering tariffs for utilities, which ultimately benefits consumers,” it stated.
Commenting on the programme, the Vice President for Global Client Services, International Finance Corporation (IFC), Jean Philippe Prosper said: “The World Bank Group is committed to promoting sustainable universal access to modern energy in Africa, and Scaling Solar is a key step towards attaining this goal by quickly delivering affordable electricity to previously unreached populations, significant progress can be made on other development goals.”
Africa has some of the world’s most abundant solar resources, yet, the bank said more than a third of the population lives without electricity.
It noted that investors developing private solar projects in Africa are often deterred by a variety of obstacles, including the unique features and structures of the different markets, high transaction costs, heavily negotiated agreements, and high perceived risk and cost of capital. As a result, the region continues to struggle with slow, relatively expensive and ineffective solar development, which impedes access to electricity.
It suggested that large-scale photovoltaic solar power could be quickly and economically developed to increase the supply of electricity to national grids and improve the reliability of power services for households and businesses.
World Bank’s Senior Director for the Energy and Extractives Global Practice’, Anita Marangoly George said: “The countries we work with in Africa to support the development of solar energy look to the World Bank Group for our full suite of services – from technical knowledge and innovation to guarantees and financing.
“Through Scaling Solar, we are able to respond nimbly and effectively to this growing area of demand.”
Scaling Solar, according to the bank, provides a straightforward package to help countries determine the size and location of projects, then auction them competitively to developers.
The initiative combines World Bank guarantees, Multilateral Investment Guarantee Agency (MIGA’s) investment guarantees, and IFC financing to mobilize privately funded solar projects that are connected to the grid.
It promised to have laid down a simplified process and suite of contract templates which significantly speeds the process to enable initial electricity production to begin within two years of initiating an engagement.
Multilateral Investment Guarantee Agency (MIGA’s) Director of Operations, Edith P. Quintrell, said: “This initiative offers a framework that allows countries to rapidly and efficiently mobilize private capital into solar projects with high development impact without having to start from scratch,”
The initiative builds on the World Bank Group’s experience in promoting small and larger-scale solar power development in emerging economies around the world and on South Africa’s successful Renewable Energy Independent Power Producer Program (REIPP).