Abu Dhabi / Emirates Business
Abu Dhabi Fund for Development (ADFD), the leading national entity for development aid, and the International Renewable Energy Agency (IRENA), the global platform for international cooperation on renewable energy, on Saturday announced that $25 million in concessional loans from ADFD have been earmarked for two solar PV projects, one each in Mauritius and Rwanda.
Announced at the Eighth Session of the IRENA Assembly, both projects – beneficiaries of the fifth funding cycle – are being
financed through the IRENA/ADFD Project Facility. Established in 2013, this seven-cycle Facility offers $350 million in concessional loans from ADFD to help developing countries access low-cost capital for renewable energy projects.
The projects have the potential to significantly transform the lives of over 2.5 million people and alleviate poverty by bringing affordable energy to low-income communities.
The loans cover up to 50% of project costs, leveraging additional funding from other sources. Since 2014, ADFD has allocated $214 million to 21 projects, attracting over $420 million in additional co-financing from governments and development funds.
“For developing countries, renewable energy is a triple win: it provides a cost-effective means of providing electricity to families, fuels economic growth, and supports energy independence and security,” said IRENA Director-General Adnan Z. Amin.
Mohammed Saif Al Suwaidi, Director General of ADFD, said: “Our collaboration with IRENA articulates ADFD’s core mandate to support sustainable economic and social progress across developing countries through financing development projects that serve vital economic sectors.”
In Mauritius, the ADFD loan of $10 million will help the Central Electricity Board install solar PV systems on rooftops of 10,000 households as part of the government’s efforts to alleviate poverty whilst contributing to the national target of achieving 35% of renewable electricity in the energy mix by 2025. An estimated 35,000 people in low income communities will benefit from significant electricity bill savings.
The project will bring 10 megawatts (MW) of new renewable energy capacity online, resulting in savings of over $35 million in fossil fuel imports over the project lifetime and improvements in the energy security of the country.
In Rwanda, the ADFD loan of $15 million will contribute to the installation of 500,000 off-grid solar PV home systems across the country, providing clean electricity for lighting, mobile phone and radio charging. The project is a major part of the government’s rural electrification strategy and is one of the most affordable payment schemes in Africa. It employs a flexible mobile payment platform, essential in areas poorly served by banking and transportation infrastructure. 2.5 million people in rural communities are expected to benefit from improved electricity acccess, and more than 2,000 local jobs will be created.