ADDIS ABABA – The Board of Directors of the African Development Bank Group has approved a $10 million reimbursable grant to support a geothermal drilling program that will add 50 megawatts of renewable energy to Ethiopia’s power system.
The Bank approved the fund for the Tulu Moye Geothermal Operations Plc (TMGO) project from the Sustainable Energy Fund for Africa (SEFA).
The project – owned by a Paris-based multinational corporation Meridiam and Reykjavik Geothermal of Iceland – entails developing and operating a 50-megawatt power plant in Ethiopia under a build-own-operate transfer structure.
The Bank says the program provides for the second phase of an additional 100 megawatts.
Upon completion, the project is expected to be the first large-scale private sector-driven geothermal development and the first Independent Power Producer in Ethiopia.
The grant complements existing facilities to mitigate the high risk associated with drilling activities and help attract commercial debt capital to finance the project, according to AfDB.
CEO of TMGO, Maxence Mirabeau said it “is essential to be financially supported during the risky drilling period by a key institution.”
“SEFA is a unique solution to unlock geothermal potential in Africa,” Maxence, “Not so many can do it.” Thank you to the SEFA/African Development Bank team.”
SEFA is a multi-donor special fund working to unlock private sector investments that contribute to providing universal access to affordable, reliable, sustainable, and modern energy services for all Africans.
Its manager João Duarte Cunha said the Fund “will play a critical role in supporting geothermal resource assessment and development, which is the riskiest phase of the project, and catalyze investments in the first private power plant in Ethiopia, paving the way for more public-private partnerships in the country’s energy sector.”
The post AfDB Approves $10mln Grant for Tulu Moye Geothermal Project appeared first on Ethiopian Monitor.
Source: Link to the Post