British International Investment (BII) has committed an investment of £162m ($200m) in the African hydropower sector in partnership with Norfund in a joint venture (JV) with Scatec.
The UK’s development finance institution (DFI) and Norfund, which is the Norwegian Investment Fund for developing countries, will have a combined stake of 49% in Scatec’s African hydropower portfolio.
The portfolio includes some operating assets and certain assets under development. These include the proposed 205MW Ruzizi III hydropower plant that will serve Rwanda, Burundi, and the Democratic Republic of Congo (DRC), the 350MW Mpatamanga project in Malawi, the 120MW Volobe hydropower plant in Madagascar, and others.
According to the UK government, the partnership between BII, Norfund, and Scatec is anticipated to generate 180,000 jobs. Besides, it will supply enough power to meet the requirements of over three million people, while offsetting at least 270,000 tonnes of CO2 equivalent per annum of greenhouse gas emissions.
UK Minister for Africa Vicky Ford said: “British International Investment is helping to deliver on the UK’s vision for the Clean Green Initiative, by providing capital to power inclusive economic sustainability across Africa.
“Investing to bolster Africa’s hydropower sector is a strong step toward helping to meet the energy demands of three million people in countries most at risk to the impacts of the climate emergency. Through these projects, UK finance will enable job creation and drive clean productive growth across the continent.”
The various pipeline projects of the portfolio will be designed and built over the next several years.
Norfund is said to have played a key role in building SN Power as a major hydropower company in developing countries. SN Power was sold in 2021 by Norfund to Scatec for $1.16bn.
At that time, Scatec and Norfund agreed to collaborate on the projects of SN Power in Africa, under a new JV structure, under which Norfund retained a stake of 49%, which will be shared now with BII.
Norfund clean energy executive vice president Mark Davis said: “The expansion of dispatchable renewables is critical to support the integration of more wind and solar energy in Africa.
“We are delighted to be able to join forces with BII in our partnership with Scatec, to further scale up our ability to provide clean and affordable energy through hydropower, enabling economic development and job creation, while avoiding emissions.”
