Mozambique Secures $2.5m Grant From AfDB To Boost Renewable Energy Penetration

Posted by Eric Ojo African News, Business News, Latest Headlines Monday, October 17th, 2022

(AFRICAN EXAMINER) – African Development Bank (AfDB) has approved a grant of $2.5 million to the Mozambican government to develop its renewable energy resources.

The grant, which was obtained through the Sustainable Energy Fund for Africa (SEFA), administered by the Bank, will be used to implement the Mozambique Renewable Energy Integration Programme (MREP) in the country.

SEFA is a multi-donor special fund that aims to unlock private sector investments that contribute to providing universal access to affordable, reliable, sustainable, and modern energy services for all in Africa.

The funding will assist the national electricity company to provide financial support for technical, economic, environmental and social feasibility studies for the development of a solar floating power plant in Chicamba reservoir.

In addition, it will support funding for a feasibility study for Energy Battery Systems Storage in up to 10 sites, as well as capacity building for EDM´s personnel; and support for tender preparation.

AfDB’s Director of Renewable Energy and Energy Efficiency, Dr. Daniel Schroth said with the support of the SEFA, Mozambique’s capacity to integrate larger shares of variable renewables will increase its efforts to become a major regional electricity supplier.

“Given that Mozambique is one of the most highly climate-vulnerable countries in the world, the project will help build a more sustainable and resilient power generation infrastructure”, he said,

While applauding the Bank’s support, the chairman of EDM, the beneficiary said: “We are very excited to launch the activities under the SEFA in Mozambique, which comes with a set of very strategic and innovative projects, that will contribute to diversify the energy matrix ad fund a study on storage needs, that will enable the development of more renewable energy projects”.

The support under SEFA, according to him, also includes a robust capacity building program, that will enable their personnel to develop strategic skills related to the development and management of renewable energy projects.

The donation will also be used to conduct studies to increase the share of variable renewable energy production in Mozambique’s energy mix. Feasibility studies to develop floating photovoltaic solar energy will be conducted in existing EDM hydropower assets.

Increasingly affected by severe and sudden cyclones, storms, and prolonged drought periods, Mozambique is endowed with abundant energy from renewable fossil resources. Over the last decade, the energy sector in Mozambique has made considerable progress.

Meanwhile, the country is a net exporter of electricity despite low access rates (57 percent in urban areas and 13 percent in rural areas). With 187 gigawatts, Mozambique has the most significant power generation potential in southern Africa, thanks to untapped resources in coal, hydroelectricity, gas, wind, and solar energy.

In addition, hydropower currently accounts for about 81 percent of installed capacity. But natural gas and renewable energy sources are set to take a growing share of Mozambique’s energy mix.

The AfDB is a key player in the energy sector in Mozambique. It provided more than $400 million in financing for the ongoing $20 billion Mozambique Liquefied Natural Gas (LNG) Project. The Bank also supports power generation, transmission and distribution, such as the Tamine Gas Project.

It is currently supporting the Mphanda Nkuwa hydroelectric power station project, the rehabilitation of the Cahora Bassa hydroelectric power station and the construction of a transmission line from the north to carry electricity to the South.