The EU-funded Electrification Finance Initiative (EDFI ElectriFI) and the UK-funded Renewable Energy Performance Program (REPP) – both managed by climate impact fund manager, Camco Clean Energy – have closed financing for the construction of a portfolio of 11 mini grids with Lesotho-based electrification start-up, OnePower (1PWR). The mini grids, with a combined capacity of 1.8MW, will serve to electrify 11 rural communities.
The solar photovoltaic (PV) mini grids will be capable of connecting 7,,300 households, providing first-time electricity to 20,000 people, small businesses, and utility centers, as well as powering seven health clinics with clean energy. Once completed, the installations will have a combined capacity of 3,480 MWh per year and will mitigate the emission of 2,780 tons of CO2 equivalent per year. The partners have stated the project vehicle will create as many as 100 local jobs throughout the construction phase, and six permanent jobs during operation period of the solar PV mini grids.
The two investors will each provide $5.9 million (£4.4 million) in equity and senior debt financing towards the project vehicle, the Sotho Minigrid Portfolio SPV – managed by 1PWR. 1PWR is also set to receive support from USAID, the Energy and Environment Partnership Trust Fund, UK Aid, and additional support from the United Nation Capital Development Fund, and the United Nations Development Fund for the development of the project.
“This investment is an excellent opportunity for EDFI ElectriFI to support OnePower in its mission to provide stable electricity to more than 20,000 citizens but also to seven health centers in the country,” stated Quentin De Hoe, ElectriFi Senior Investment Officer at EDFI Management Company, adding, “It was a pleasure to work with a team of strong professionals dedicated to delivering the first solar mini grids in Lesotho.”
The project will also be supported by GET.invest – a program that mobilizes investment towards decentralized renewable energy in developing countries – by enabling 1PWR a tariff of $0.22 per kWh.
“We are proud to have supported 1PWR towards reaching this milestone with EDFI ElectriFI and REPP. The company’s persistent engagement and innovative portfolio approached have resulted in a major step for rural electrification in Lesotho, bringing modern energy services to those that need it the most,” stated Michael Franz, Team Leader at GET.invest.
With approximately 62% of its population lacking access to electricity, the landlocked Kingdom of Lesotho has one of the lowest electrification rates in Africa. The country’s rural electrification rate is estimated to be below 20%.