The Sahofika hydro-power project in Madagascar has received funding from the African Development Bank which recently gave the green light to a Partial Risk Guarantee (PRG) of US$100 million to support , which will provide an additional 205MW of renewable energy generation capacity to the national grid, benefitting over 2 million people.
The help from the bank will also include risk mitigation to the project developers and the debt providers by supporting the payment obligations of JIRAMA, the state-owned off-taker. The Sahofika hydro-power project is planned to be located atop the Onive River, south of the country’s capital Antananarivo. It will involve the design, construction and operation of a 205 MW hydro-electric power plant, the construction of a 110 km transmission line to the site, and construction of camp facilities and 112 km of access roads.
Also read: Madagascar receives US $140m grant for rural transport project.
Power Generation from the project
When completed, the Sahofika hydro-power project will generate 1,570 GWh of renewable power annually and will enable Madagascar to displace up to 90% of thermal energy generation and to expand its energy mix to more renewable sources. Additionally, the Sahofika hydro-power project will greatly reduce the average end-user tariffs, and greenhouse gas emissions amounting to 32,469 kt of CO2 over the 35-year concession period. The African Development Bank’s support to the national utility, JIRAMA, through the PRG provides much-needed credit enhancement as JIRAMA continues to build its track-record as a bankable electricity off-taker that will in-turn mobilize investments into Madagascar’s energy sector. This will also enable the country to achieve its strategic goals in terms of increased energy access, a more diversified energy mix and least cost generation. The Sahofika hydro-power Project is aligned with the African Development Bank’s High 5 Priority to “Light Up and Power Africa”, which is the Bank’s focus on energy access, and strengthening infrastructure for inclusive growth, as well as Madagascar’s Nationally Determined Contributions (NDCs) and the country’s Emergence Plan which prioritizes boosting the power sector and increasing electricity access.
