IRENA and ADFD fund more renewable projects
The $57mn worth of loans will fund five projects in rural areas of developing countries.
The International Renewable Energy Agency (IRENA) and the Abu Dhabi Fund for Development (ADFD) have announced $57mn in concessional loans for five renewable energy projects in remote areas of developing countries.
The loans will go to projects in a geographically diverse set of countries including Argentina, Cuba, Iran, Mauritania and St. Vincent and the Grenadines.
The projects to be financed in the second cycle have a combined total capacity of 35 megawatts (MW), bringing reliable and sustainable power to more than 280,000 people in rural communities that lack access to modern energy services.
“Renewable energy offers the prospect of clean, affordable power to the 1.3 billion people currently off the electricity grid,” said IRENA director general Adnan Z. Amin at a press conference on Sunday on the sidelines of IRENA’s fifth Assembly.
“While renewable energy resources are abundant in many communities suffering from energy poverty, finance is still a key challenge for deployment. That is why the partnership between IRENA and ADFD is so important as a pioneering effort.”
This is the second loan cycle of seven, which together will commit $350mn over seven years to the deployment of renewable energy in developing countries, with a total project value of an estimated $800mn. The funds from ADFD mobilise other funds and will lead to more than double the invested amount.
Projects approved for funding in the second loan cycle include solar, hydro, hybrid (wind and solar) and geothermal energy. The projects selected represent a mix of renewable energy sources, are innovative, potentially replicable or scalable, and will improve energy access.
“As part of its mandate to work on projects with a profound impact on the economies of developing countries, ADFD has collaborated with IRENA to support the renewable energy sector as a tool for economic and social development,” said Adel Abdulla Al Hosani, director of operations department in ADFD.
“Towards this priority, we are keen to support the economic development and deployment of sustainable energy projects in countries with immense clean energy potential, but lacking necessary financial resources and project management expertise.”
The IRENA/ADFD Project Facility pioneers the support of renewable energy as a viable and sustainable focus for foreign development assistance that offers long-term social and economic benefits to developing countries.
The third funding cycle of the Project Facility is now open for project proposals, with concessional loan interest rates of 1-2%. These new, lower rates will support an even broader range of renewable energy projects throughout the remaining five loan cycles.
About the Funded Projects:
Argentina: An innovative 4MW mini-hydro project in Nahueve is receiving a loan of $15mn. The project will provide a stable energy supply throughout the northern rural region of the province and will pump irrigation and clean drinking water to Nahueve inhabitants. More than 22,500 people will benefit from the project.
Cuba: A 10MW solar energy project is receiving a loan of $15mn dollars. The project will provide energy stability, demonstrate renewable energy’s viability in the country, create jobs and help the environment. More than 5,300 people will benefit from the project.
Iran: A 5MW, first-of-its-kind, small-scale geothermal project in Ardebil is receiving a loan of six million dollars. The geothermal power plant will produce electricity and thermal energy for rural Ardebil to provide local heating, greenhouse agriculture and fish farming. Governmental organizations such as the electricity, gas and environment departments, and the local population of 150,000 people will benefit from the project.
Mauritania: A 1MW solar, wind and hydropower hybrid project will receive a loan of $6mn. The project involves electrification by solar multifunctional platforms for small villages including 10 solar photovoltaic power plants with storage, small wind turbines installed in fishing villages, and the connection of a group of villages with a hydroelectric network. The improved access to electricity will benefit various stakeholders including small villages, rural centres and fishing villages.
St. Vincent and the Grenadines: A 10 to 15MW geothermal project is receiving a loan of $15mn. The project will connect to the energy grid to provide a consistent power source for the entire country and will influence the deployment of additional geothermal projects in the Caribbean. The entire population of 104,000 people will benefit from the project.