NAIROBI, Feb 24 (Reuters) - Africa Finance Corporation (AFC)
is investing $63 million to build and operate a 60 megawatt (MW)
wind farm in Djibouti, the Lagos-based development financier
said on Monday.
Established in 2007 by West African states such as Nigeria
and Ghana to invest in infrastructure projects across the
continent, AFC has a balance sheet of about $5 billion.
It is partnering with Great Horn Investment Holdings,
Climate Fund Managers and Dutch development bank FMO in the
project, which is located in the Ghoubet area near Lake Assal.
Operations at the project, which already has a 25-year power
purchase agreement with power distributor Électricité de
Djibouti, are scheduled to start in 2021.
The Horn of African nation's power sector faces significant
challenges, AFC said in a statement, with less than 100 MW
reliably available for a population of close to a million
people.
"Electricity demand is also expected to considerably
increase due to various large-scale infrastructure projects
including ports, free-trade zones and railways that the
Government of Djibouti has undertaken," it said.
Backing for the project is all sponsor equity financing, AFC
said, enabling construction to begin within two years, rather
than the usual 3-5 years. It also has some government and
third-party guarantees.