Abidjan, Ivory Coast — The African Development Bank Group has approved a €6 million concessional financing package from the Sustainable Energy Fund for Africa (SEFA), a special multi-donor fund managed by the Bank, to accelerate the completion of Burkina Faso’s Dédougou photovoltaic solar project in support of the Bank’s Desert-to-Power initiative.
The project involves designing, constructing and operating an 18-megawatt solar power plant in Dédougou, located 250 kilometres west of the capital, Ouagadougou. Burkina Faso is one of five priority countries under the Desert-to-Power initiative, which aims to generate 10 gigawatts of solar power across 11 Sahelian countries by 2030, promoting socio-economic development.
This project stands as one of the first independent power producers (IPPs) in Burkina Faso and has secured both senior and subordinated loans, along with a 25-year Power Purchase Agreement (PPA) with the Société Nationale d’électricité du Burkina Faso (SONABEL). However, the project encountered challenges in reaching financial close due to cost escalations resulting from the COVID-19 pandemic. The SEFA Covid-19 IPP Relief Programme (SEFA Programme) played a pivotal role in overcoming these hurdles. Through concessional financing, SEFA helped restructure the financial arrangements to absorb the pandemic-related cost increases, ensuring the project’s viability and preserving the originally agreed structure with the Government of Burkina Faso, thereby contributing to the country’s energy security.
Under the SEFA Programme, a €2.5 million senior concessional loan and a €3.5 million reimbursable grant have been provided through its concessional finance facility. SEFA’s involvement has been instrumental in unlocking additional financing from the Dutch entrepreneurial development bank, FMO (www.FMO.nl), including subordinated and senior loans. These funds will be disbursed to Dédougou Solaire SARL, the project company jointly developed by QAIR (www.Qair.Energy), which is responsible for managing the project.
As part of the Desert-to-Power initiative, the project is expected to contribute to energy security, diversification of the energy mix, reduced electricity costs, and increased national electrification rates.
“The Dédougou Solar PV project increases Burkina Faso’s renewable energy generation capacity in line with the objectives of the Desert-to-Power Initiative. By backing projects like this, we are making tangible strides toward electrifying the Sahel, bolstering energy security, and improving the lives of millions,” said Dr. Daniel SCHROTH, Director of the Renewable Energy and Energy Efficiency Department at the African Development Bank.
“Abdoulaye Toure, CFO at Qair Africa, acknowledged SEFA’s support and the project’s advancement: “We are pleased with this approval by SEFA and thank the African Development Bank for their support of the project. This allows us to move forward with our commitment to supporting Burkina Faso’s energy goals by developing a second solar plant, just a year after the successful commissioning of Zano. This achievement aligns with the country’s ambitions for energy supply and reinforces Qair’s vision of becoming a leading player in Africa’s renewable energy sector in the coming years.”
