The African Development Bank Group (AfDB) has approved an $8 million concessional loan to support the construction of the 25MW Ilute Solar Photovoltaic Power Plant in Zambia, a first of its kind solar project in Africa where an energy trading company is sole off-taker.
AfDB will provide the concessional finance for Ilute through its Sustainable Energy Fund for Africa (SEFA), a multi-donor Special Fund managed by the Bank.
The solar energy facility is being developed by Serengeti Energy Ltd and Western Solar Power Ltd. The solar power plant will be located in Zambia’s Sesheke District, and has a 25-year power purchase agreement with leading Africa renewable energy trading company and aggregator, Africa GreenCo.
Additionally, the Ilute project is expected to serve as a pilot for Africa GreenCo’s energy aggregator model under the Zambia Electricity Supply Corporation Limited (ZESCO). Africa GreenCo will act as an intermediary off-taker and sell the generated electricity through the Southern African Power Pool Day-Ahead Market
“We are delighted to support the Ilute Solar PV project – which will be the first project to use Africa GreenCo as an intermediate off-taker. SEFA’s support has been instrumental in bridging the financing gap and will pave the way for future projects that contribute to Southern Africa’s energy transition,” said Dr Daniel Schroth, African Development Bank Director for Renewable Energy and Energy Efficiency.
Anton-Louis Olivier, CEO of Serengeti Energy, acknowledged SEFA’s support. He said, “We appreciate the support from the African Development Bank Group and SEFA in helping us move the Ilute 25MW Solar PV project forward. This loan addresses the financial challenges we’ve faced due to the pandemic and rising costs.”
“The Ilute project is a testament to innovative collaboration and serves as a pioneering model for future renewable energy initiatives in Zambia as well as the wider region,” Olivier added.