First-of-kind financing to give major boost to Tanzania’s mini-grid sector
More than 34,000 people are set to gain first-time access to clean, grid-quality energy after a landmark deal was agreed to provide long-term finance for solar PV mini-grids in Tanzania.
Before now, mini-grid developers have found it hard to get their projects off the ground because lenders have been reluctant to provide long-term finance due to the risks involved and the small-scale nature of individual installations.
But now a new funding vehicle is enabling developer PowerGen Renewable Energy to progress with an initial construction phase that will see approximately 60 new mini-grids installed, providing electricity on a Pay-As-You-Go (PAYG) basis to homes and businesses in rural Tanzania.
REPP, which is managed by Camco Clean Energy, is enabling this innovative funding structure by providing a US$3 million long-term senior loan to the funding vehicle established by CrossBoundary Energy Access (CBEA). PowerGen may sell its existing and future operating mini-grids in Tanzania into the funding vehicle while continuing to operate the sites and service customers.
Read CBEA’s press release for more on the innovative funding.