Entrepreneurial Development Bank ( FMO), NEoT Offgrid Africa, a platform dedicated to financing decentralized energy in Africa(NOA), and Winch Energy a global, off-grid energy developer and technology integrator have invested approximately $12 million in mini-grid projects in Uganda and Sierra Leone.
This is to advance their global goal of building the greatest portfolio of mini-grids in Sub-Saharan Africa, with a portfolio worth $100 million.
This project will provide off-grid and remotely controllable solar solutions – Remote Power Units (RPU) – to 49 villages in Sierra Leone and Uganda, providing power to over 60,000 people.
Also, the project will make a significant contribution to the UN’s Sustainable Development Goals (SDGs), which include, among other things, the reduction of poverty.
Winch Energy will develop and manufacture the RPUs at their manufacturing site in Sicily, Italy. 6,000 portable batteries will be distributed in the second stage in these areas to help people who live too far away from the power plants. At the same time, collaborations with telecom carriers will be formed to ensure that homes have internet connections.
The RPUs for the first 13 communities transported to Uganda have already begun to be installed as part of the project. Before the end of 2021, all 25 RPUs are planned to arrive in Uganda. In Sierra Leone, an additional 12 village power plants are already running and supplying customers with clean renewable energy. The Ugandan sites are planned to open in early 2022, while all 24 Sierra Leone locations are expected to open in Q2 2022.
“Supporting renewable energy initiatives is fundamental to FMO’s strategy, as lack of access to electricity is one of the major impediments to development, Mini-grids are becoming a primary strategic emphasis for FMO as they are considered as critical to boosting access to power,” says Huub Cornelissen, FMO’s Energy Director.
Huub further commented that the completion of this first mini-grid loan transaction is a significant achievement for FMO and a significant contribution to the sector’s future development. By assembling a cross-country portfolio of assets, the cooperation with Winch and NOA demonstrates that mini-grids can be financed at scale and efficiently. The incorporation of a future project facility enables growth and offers the developers a cost-effective funding source for the deployment of other mini-grids.
The current investment vehicle for those projects is Winch Energy IPP Holdings (WIPP), in which NOA is the majority shareholder. FMO, the Dutch entrepreneurial development bank, has organized a syndicated facility in which FMO (through the Access to Energy Fund) and the Renewable Energy Performance Platform (REPP); managed by Camco Clean Energy (Camco) will lend WIPP the first tranche of approximately US$4 million for its mini-grid portfolio in Uganda and Sierra Leone.
WIPP aims to extend its operations in Sierra Leone, Uganda, and other countries, thus the facility includes a second tranche of up to $6 million to fund future projects.
The CEO of Winch Energy expressed his delight: “ We are obviously delighted with the closing of this debt financing from FMO and REPP Camco, which represents a landmark for the off-grid industry in Africa and worldwide”.
He went on to express that this first tranche marks the start of the company’s investment program with NOA, and plans to make additional investments in Sierra Leone and Uganda in the near future, as well as Nigeria and Ethiopia in 2022.
He expresses his gratitude to the Winch Energy and NOA teams for their tireless efforts in bringing this novel debt financing to fruition.
“NOA is very delighted to join in this ambitious project alongside Winch Energy and two of the most active lenders in the African off-grid market,” says Philippe Ringenbach, CEO of NEoT Capital and President of NOA. This deal solidifies NOA’s position as a major supplier of innovative finance in Sub-Saharan Africa’s renewable energy sector, which has enormous potential and an equal amount of funding need.
