British finance institution, Standard Chartered, has extended a EUR 1.29 billion (US$1,4 billion) loan to the Angolan Ministry of Finance for the construction of 48 solar photovoltaic mini-grids, which will connect 203,000 households to electricity in Angola.
The electrification project is being developed by the Angolan Ministry of Energy and Water, and will support rural villages across the country to become more self-sufficient, and less reliant on Angola’s main electricity network. Around 60 communities are set to benefit.
“We are thrilled to complete the financing of this important project for the Angolan government to supply renewable energy-sourced electricity to local communities. It’s another great example of our collaboration with ECAs and contractors to deliver for our clients,” said Yoshi Ichikawa, Head of Structured Export Finance for Europe, Standard Chartered Bank.
The 48 hybrid photovoltaic generation systems will have energy storage and will operate autonomously, independent of Angola’s national electricity grid. The systems are expected to provide access to 100% renewable electricity to communities not connected to the grid.
Additionally, the financing by Standard Chartered will also support the expansion of the national grid in Malanje and build new lines and networks connecting other municipalities. The installation of the new electricity network will help diversify the country’s energy mix and calculations show that it can save up to 7.9 megatonnes of CO2 emissions.
Standard Chartered acted as sole Bookrunner, Original Lender, Structuring Bank and Mandated Lead Arranger. The bank said it structured the financing to help meet eight of the United Nations’ Sustainable Development Goals and align to environmental and social risk management international best practices.
The financing was backed by the German Export Credit Agency, Euler Hermes, and the contractor, MCA Group, is managing the construction and project management. Of the EUR 1.29 billion total, EUR 1.2 billion is supported through Euler Hermes and the remaining EUR 0.09bn is a commercial loan.
“We are really proud that we, as ECA, can play a part in supporting this sustainable project with Export Credit Guarantees of the Federal Republic of Germany,” said Edna Schöne, Executive Board Member, Euler Hermes.
“This project is not only of crucial importance for Angola and sub-Saharan Africa but helps to reduce greenhouse gas emissions. We are pleased that many German small and medium-sized companies are involved in this project and will contribute to its success with their technology and know-how,” Schöne concluded.