Climate Fund Managers (CFM) has entered into a Joint Development Agreement with Energy Resources Senegal (ERS) to develop a 30 MW Solar PV and 15MW/45MWh battery storage system in Niakhar, Senegal.
Senegal’s installed capacity is currently largely driven by expensive HFO fuelled thermal power. The country is one of the first to pass a renewable energy law in West Africa and is regarded as one of the trailblazers in the renewable energy sector. With the intention of increasing generation capacity and the share of renewables in the country’s energy mix, the government of Senegal has started exploring renewables with storage as a possible solution to meet growing demand.
The Niakhar project will be Senegal’s first solar plant with a large battery storage system. Once developed, the project represents an opportunity of approximately USD 40 million for Climate Investor One’s Construction Equity Fund, the main construction financing vehicle under the management of CFM. The project promoter, ERS, is emerging in energy development in Senegal and Western Africa, with an objective to realize 500MW in various types of energy projects by 2025. ERS and CFM will develop, construct, own and operate the hybrid power project, with CFM acting as E&S and technical advisor throughout the development process.
As Senegal’s major hybrid solar power plant with battery storage, the project will pave the way for further applications of this technology not only in Senegal, but also in other African countries with ambitions to increase their reliance on flexible renewable energy solutions. The project will provide cleaner energy to the grid, displacing some of the more expensive and carbon intensive energy sources. In addition, the project will add base load capacity, improving overall grid stability.
Moustapha Sène, ERS’s CEO stated: “With CFM joining, a key and experienced player in renewables on the continent, ERS has achieved today a major milestone on this strategic project for our country’s future electricity mix and consequently for our economy. After the commissioning of our first solar PV plant in Senegal in 2018, this project confirms our ambition to become a key player in decarbonated energies on the continent.”
Sebastian Surie, CFM’s Regional Head for the African region, added: “We are excited to partner with ERS and deliver a first of its kind renewable solution to the Senegalese energy market. The ERS team have an ambitious pipeline of projects that strongly align with Climate Investor One’s key objectives. This initial project with ERS will serve clean power to over 150,000 people.”
About Energy Resources Senegal:
ERS is a Senegalese energy developer and producer specializing in energy production. Launched in 2013, ERS is today 51% owned by a Senegalese entrepreneur, Moustapha Sene and 49% by SENELEC SA (“Senelec”, a state-owned utility in Senegal), after Senelec entered ERS capital in 2019. ERS is already operating a 20MW solar PV plant in Senegal and has positioned itself to build out a pipeline of 500MW of energy projects, including a gas to power project benefiting from the rising gas industry in Senegal.
About Climate Fund Managers (CFM):
CFM is a leading blended finance fund manager dedicated to securing a sustainable future through investing across global emerging markets. CFM has a long-term vision to structure cutting edge financing facilities around thematic areas of climate change mitigation and adaptation, including renewable energy, water and oceans, sustainable land use and sustainable cities. CFM is established as a joint venture between the Dutch development bank FMO and Sanlam InfraWorks – part of the Sanlam Group of South Africa.
Climate Investor One (CI1) is the inaugural facility managed by CFM, focused on providing capital to renewable energy projects in developing countries. CI1 has a focus on Africa, South & Southeast Asia, and Latin America, and uses a whole-of-life financing approach intended to reduce implementation timelines. The facility also enjoys support from the EU through its External Investment Plan, a part of its wider commitment to sustainable development and climate change mitigation, as well as cornerstone support from the Ministry of Foreign Affairs of the Netherlands, the Nordic Development Fund (NDF) and USAID’s Power Africa programme.