Malawi is set to receive its first commercial scale independent solar power palnt. Benjamin Mugisha, African Trade Insurance Agency’s (ATI) Chief Underwriting Officer confirmed the report and said the plant aims to reduce the country’s energy deficit.
The dubbed Nkhotakota Solar Power Plant project will be funded by ATI’s Regional Liquidity Support Facility (RLSF), designed to cover the late-payment risks of publicly-owned power utilities at a cost of US $67m. The firm, through this facility, is providing liquidity cover for a tenor of up to 10 years.
The Nkhotakota Solar Power Plant is part of the Malawi government’s plan to move the country away from its reliance on hydropower, which currently represents more than 90% of its energy mix. It will be developed in two phases of 21MWac and 16MWac.
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Reliance on hydropower
The project is the second renewable energy project to be backed by the ATI’s Regional Liquidity Support Facility. Upon completion, the power plant is expected to add 37MWac of clean energy to the national capacity, which is currently estimated at 362MWac. The completed project will supply electricity for up to 15,000 Malawian households.
This reliance on hydropower has left the landlocked country vulnerable to frequent power supply cuts in times of drought. The solar power plant is expected to provide sustainable, stable and consistent energy access.
“This project demonstrates that there is still opportunity and demand for renewable energy projects in Africa. ATI is excited to be part of this potentially transformative project, particular now, when it is so important to show the world that it is still possible to build sound renewable energy projects that can have lasting change,” said Mr, Benjamin.
About Regional Liquidity Support Facility
The RLSF was launched in 2017 by ATI and the German Development Bank (KfW), with financing from the German Federal Ministry for Economic Cooperation and Development (BMZ). The facility was created to help tackle climate change and attract investments by supporting renewable energy projects in member countries.
