Financing Mini-Grids in East Africa

About the Library

KNOWLEDGE PRODUCT SUMMARY

Title

Financing Mini-Grids in East Africa

Type

Case Studies

Organization

GVEP International

Region/Country

Global/Multiple

Website

no website

Contact

Peter J. George

E-mail

write an email

Year of publication

2013

Description

Mini-grids require debt financing to be financially viable.

› The “ABC” model – a PPA with an anchor customer – is at this point critical to bankability and still very much in its infancy in East Africa – few case studies available. › While local banks are beginning to recognize the bankability of well-executed projects (most of which include offtake of excess power to grid), and guarantee support from donors is encouraging them (e.g. TEDAP credit line through Tz commercial banks), we believe financing in the near/mid-term will be at “topco” not “project” level, and more similar to long-tenor corporate finance than loans based on the contractual and risk-mitigated principles of project finance.

› However, we believe that over time, more sources including larger, international banks and institutions will become available, providing lower cost debt at lower rates, once there is more certainty/understanding about revenue flows.

Author / Producer

GVEP International

View / Download

• Link: https://www.giz.de/fachexpertise/downloads/2014-en-george-pep-fachworkshop-mini-grids.pdf

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Theme / Topic

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• Financing for Micro and Mini Hydro