EREN Renewable Energy entered into an agreement with Banque Internationale pour le Commerce, l’Industrie et l’Artisanat du Burkina (BICIAB), a local BNP Paribas Group subsidiary, to provide financing for the 15MWp solar power plant under construction in Burkina Faso.
A XOF9.2 billion loan, equivalent to around $16.5 million, was granted to Essakane Solar, the project venture that owns the power plant. The funding comes in the form of a senior limited-recourse loan.
The Essakane Solar power plant is located on the site of the IAMGOLD Essakane SA gold mine. Essakane Solar and IAMGOLD entered into a PPA in March 2017. The solar power plant will be connected to the mine’s heavy fuel plant to make it the world’s largest hybrid solar photovoltaic-diesel facility.
The Essakane Solar project was developed jointly by Africa Energy Management Platform (AEMP) and EREN RE. Wärtsilä was awarded the contract for the construction, which began in May 2017, with a commissioning date scheduled in Q1 of next year. The project will help to reduce the mine’s fuel consumption by about six million liters of diesel per year and lower its annual CO2 emissions by around 18,500 tons.
As part of an ambitious local development policy, the project will create 40 new operational jobs and devote a percentage of its revenues to local development.
Christophe Fleurence, VP Business Development – Africa of EREN RE, commented: “We are delighted with this collaboration with BICIAB, which has shown a great reactivity in the development of the project’s financing. This step marks the financial closure for what is a flagship project: after proving electricity generated from renewable energy could be cost-competitive and reliable for industrial customers such as mining companies, we are now demonstrating that captive projects such as Essakane involving private buyers can be bankable and carried out without public subsidies. Our goal is to roll out an optimized project scheme for large electricity consumers, validated by the banking sector—not only in Burkina Faso but also around the globe.”