CABEOLICA WIND POWER

• Reference: P-CV-FE0-001
• Approval date: 18/05/2010
• Start date: 21/06/2011
• Appraisal Date: 20/04/2010
• Status: OngoingOnGo
• Implementing Agency: CABEOLICA S.A
• Location: Cape Verde

The project consists in the construction, operation and maintenance of four wind farms on four islands of the Cape Verdean archipelago (S

The project will allow Cape Verde to substitute fuel oil generators with generation units relying on domestic and renewable resources. This will allow

(i)Provide affordable electricity from domestic wind resources to substitute for imported fuel oil and thereby sheltering the sector from fluctuations in oil prices, and

(ii) support the government's strategy for the generation of power from renewable domestic energy sources.

Cape Verde currently has one of the highest unit electricity generation cost on the continent. This comes as a result of

(i) the country having to rely on imported fuel oil for generation combined with high transport costs; and

(ii) the lack of economies of scale due to the small size of the national economy and individual islands.

Wind energy is a natural candidate for energy generation in Cape Verde with collected wind data suggesting that the proposed sites have a very strong potential for wind energy generation.

Cape Verde suffers from chronic electricity generation shortages and is currently relying on expensive imported oil for generation. Moreover, the challenges associated with small archipelago economies prevent Cape Verde from having an interconnected power system throughout the country. The project will help towards improving the reliability of electricity supply to economic actors and households and contribute to supporting the strong growth of the economy, particularly the tourist sector and industries that depend on reliable electricity sources.

The project is in line with "Cape Verde's Energy Policy", which aims to promote investment from the private sector in the power sector and particularly from renewable and domestic resources such as wind. The project will be pivotal for the country to meet its targets in terms of renewable energy generation: 25% of total generation by 2011 and 50% by 2020.

Being the first Independent Power Producer (IPP) in the sector and one of the first large-scale PPP project in the country, the project is also helping to develop the national legal framework for such structures.

Finally, the country will benefit from employment during the construction and operation periods and from training and technology transfer related to wind power generation.

DIALL Hammadoun Amadou - PESR