Globeleq Reaches Financial Close on Kenya’s First Utility Scale IPP Solar Project
NAIROBI – 03 June 2019: Globeleq, a power sector leader in Africa, has reached financial close of the 40 MWAC (52 MW p) Malindi Solar photovoltaic (PV) project in Malindi, Kenya and is commencing construction of the plant.
The US$69 million project is located in Langobaya, Malindi District, Kilifi County, about 120 kms north-east of Mombasa and is one of the first IPP owned utility scale solar power plants in Kenya to begin construction. Electricity will be sold through a 20-year agreement with the national distribution company, Kenya Power.
Globeleq has been working with the project originator, Africa Energy Development Corporation (AEDC), who will retain 10% ownership of the project, and its partner, IDEA Power, to bring the project to construction by providing equity, project development and construction management experience. CDC, the UK’s development finance institution, as the mandated lead arranger, has sourced US$52 million in debt financing including $20 million from DEG, the German development finance institution.
Paul Hanrahan, Globeleq’s CEO said: “The attractive investment climate combined with strong local community support sets the stage for this important project as well as future investments in Kenya. We are extremely pleased to be making this investment into the Kenyan energy sector.’’
Zohrab Mawani, AEDC’s Director added: “AEDC is excited to have reached this significant milestone with the Malindi project. Working with our partners, we are very pleased to contribute to sustainable economic development in Kenya and look forward to continued growth in Sub Saharan Africa.”
The Engineering, Procurement and Construction company, Sterling and Wilson Solar is commencing with civil and electrical construction works. Land rights, environmental and local permits have been obtained, and the project team has been conducting regular community consultations. Construction will take around twelve months with the plant reaching commercial operations in mid-2020.
It is expected the project will need around 250 workers during construction, many of which will be hired from the local community. Globeleq will oversee the construction and operations of the power plant.