The Sustainable Energy Fund for Africa (SEFA) has approved a US$1 million grant to finalise pre-investment activities for a hybrid renewable energy project in Nosy Be Island in Madagascar.
An African Development Bank (AfDB) statement obtained by PANA here Tuesday said the grant would be used to finance feasibility studies for a combination of hydro, wind and solar technologies, technical assistance to the national power utility, and the transactions advisory for a Public Private Partnership.
Through this intervention, the AfDB will play a catalytic role and pave the way for private investors and other financiers to work towards delivering a sustainable energy solution with huge socio-economic impacts on the island.
Nosy Be Island is one of the most appreciated tourism zones in Madagascar. but is severely challenged in terms of access to reliable, affordable and clean energy.
The project – of an estimated investment cost totalling US$30 million – thus aims at constructing a more sustainable power generation complex with an initial capacity of 8MW to partly substitute and complement the existing high-cost thermal electricity generation.
Seventy new businesses and around 300 additional jobs per year mostly from tourism and hospitality sector would be created as a result of additional electricity supplied by the project.
SEFA is a joint initiative between the AfDB and the Government of Denmark comprising resources of up to US$56 million.
It operates through two components – project preparation grants to facilitate the preparation of medium-scale renewable energy generation and energy efficiency projects; and equity investments to bridge the financing gap for small and medium-scale renewable energy generation projects.
SEFA is structured to be used as a flexible multi-donor facility to support the access to sustainable energy agenda in Africa.