SEFA grants Comoros US$ 480,000 to facilitate private sector investments in renewable energy sector
The Sustainable Energy Fund for Africa (SEFA) approved on Thursday, 30 October 2014, a US$ 480,000 grant for technical assistance to the Government of the Union of Comoros for a project to facilitate private sector participation in developing renewable energy. The grant will be funded through the “enabling environment” window of this AfDB-administered multi-donor facility mandated to unlock investments in clean energy projects in the continent.
This SEFA technical assistance project will help improve access to reliable and cost-effective modern energy services for households, businesses and industries in Comoros. Its specific goals are to support government in; (i) developing tariff structures (feed in tariff) for small to medium renewable energy projects; (ii) developing standard contractual or legal documents (power purchase agreements/steam supply agreements) for renewable energy; and (iii) capacity building and skills enhancement programs on technical, economic, financial and legal aspects of renewable energy for the proposed Renewable Energy Unit.
“This intervention is expected to increase private sector participation in clean energy. Our long term goal is that the private sector will become an active investor and supplier of electricity in Comoros in everything from geothermal to hydro, solar and wind,” said Alex Rugamba, Director of the AfDB’s Energy, Environment and Climate Change Department.
The Comoros is highly dependent on fossil fuels and biomass (wood and charcoal) for power generation, which makes it an excellent candidate for the development of renewable energy. It is estimated that 70% of its energy use is attributed to biomass, while the remainder comes entirely from imported fossil fuels of which 21% is used directly (transport) and 8% is used for electricity generation. Access to electricity remains relatively limited, with only 8% of the population being serviced in the three islands (Grande Comore, Moheli and Anjouan).
The Comoros Ministry of Planning Energy and Water will implement the SEFA grant over a 24-month period. The grant will complement the ongoing “Energy Sector Support Project (ESSP)” financed by AfDB and World Bank. That project proposes to explore the potential of geothermal to gradually replace the use of fossil fuels in Grand Comore and make a complete transition to full electricity production from geothermal.
About the Sustainable Energy Fund for Africa (SEFA): SEFA is a multi-donor facility to support the sustainable energy agenda in Africa, operating through three components: (i) grants to facilitate the preparation of medium-scale renewable energy generation and energy efficiency projects (ii) equity investments to bridge the financing gap for small- and medium-scale renewable energy generation projects and; (iii) support to public sector in improving the enabling environment for private investments in sustainable energy. SEFA is endowed with US $60 million from the Governments of Denmark and United States. The Fund is hosted by the Energy, Environment and Climate Change Department of the AfDB.