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Somalia is about to get its first hybrid solar PV plant in the city of Baidoa. The Multilateral Investment Guarantee Agency (MIGA) of the World Bank Group has issued a guarantee of $5.67 million to cover Kube Energys equity and debt investments in Kube Energy Somalia for up to 15 years against the risks of expropriation and war and civil disturbance. This is MIGAs first project in Somalia, which became a MIGA member country in March 2020. Kube Energy is developing the project in collaboration with the government of the South West State of Somalia. It will be financed and developed in partnership with CrossBoundary Energy. Hiroshi Matano, MIGA executive vice president said they are eager to support investment into renewable energy infrastructure in fragile markets and contribute to the UNs efforts to rach an 80% energy access target in Somalia. This is first-of-its kind transaction will serve as a model for other international organisations seeking clean energy at a lower cost, while encouraging energy access for communities and governments, said Matano. The power plant will have a capacity of approximately 2.8MW of solar PV modules and 4.8MWh of battery storage integrated with synchronised generators. The solar hybrid power plant will displace an estimated fuel usage of approximately 1 million liters per year, resulting in avoided greenhouse gas emissions of approximately 2,800 tons of C02e per year. The plant is expected to generate around 4,000 MWh of electricity per year, of which approximately 90% would be provided by the solar array. The electricity will be supplied to the UN operation and potentially to other international organisations and government offices and public services, once power purchase agreements are signed. There is potential to expand the capacity of the plant and distribute electricity to communities across the city through a local utility company. The project is meant to increase energy access, reduce greenhouse gas emissions and build clean power generation capacity for the city of Baidoa, an important regional trading hub with a growing population of people displaced due to conflict and drought- While it will initially serve a limited number offtakers, including the United Nations, the intention is for the power plant to form part of Baidoas permanent energy infrastructure. This will increase access to clean and affordable power for the local government and could potentially expand to businesses and residents. Baidoas residents could also benefit from the project as the workforce will be recruited locally for construction, operations and maintenance, building local technical capacity and an ecosystem around renewable energy. Ownership of the plant will be transferred to local authorities after 15 years of commercial operations. In addition, the reduction of greenhouse gas emissions will contribute to improving the quality of the environment in a region which is severely affected by climate change. |
