Uganda Launches Second 10MW Solar Power Plant
Building Energy S.p.A, a multinational company operating as a Globally Integrated IPP (Integrated Power Producer) in the Renewable Energy Industry, has announced the inauguration of the Tororo Solar Plant located at around 10 km from the border with Kenya. With a capacity of 10 MWp (16 GWh per year), the Tororo Solar Plant is among the largest in Eastern Africa.
Building Energy was also responsible for the development of the project, arranging the financing, as well as the construction and commissioning of the plant. The beginning of operations has been celebrated on the occasion of the ribbon cutting ceremony in Tororo, in the presence of Matteo Brambilla, MD Africa and Middle East at Building Energy, Attilio Pacifici, EU Ambassador and Head of the EU Delegation to Uganda.
Consisting of 32,240 photovoltaic panels distributed over a 14 hectare site, the facility is designed to generate around 16 GWh of energy annually, catering to the energy needs of more than 35,838 people. In addition to covering the community’s energy needs, the Tororo Solar Plant will foster clean industrial development in the town of Tororo and at the same time save atmospheric emissions of more than 7,200 tonnes of CO2 per year, corresponding to the consumption of around 2,800 petrol-powered cars. Community Development initiatives are also underway.
Likewise the Soroti Solar Plant, which began operation last December, the Tororo Solar Plant was developed under the Global Energy Transfer Feed in Tariff (“GET FiT”), a dedicated support scheme for renewable energy projects managed by Germany’s KfW Development Bank in partnership with Uganda’s Electricity Regulatory Agency (ERA) and funded by the EU-Africa Infrastructure Trust Fund, the governments of Norway, Germany, and the United Kingdom. The GET FiT programme helps renewable energy sources become more affordable and therefore more accessible in Eastern Africa.
The EU-Africa Infrastructure Trust Fund has provided funds through the GET FiT Solar Facility equivalent to 7,08 million euros in the form of a top-up payment per kWh of delivered electricity over 20 years. This financing fills the gap between the generation costs and the feed-in tariff set by Uganda Electricity Transmission Company Limited (UETCL) through a Power Purchase Agreement (PPA).
The overall $19.6 million construction investment at Tororo was partially funded by FMO, the Dutch development bank which, as Mandated Lead Arranger, coordinated the provision of a $14.7 million term loan facility. Fifty percent of the funding was syndicated to the Emerging Africa Infrastructure Fund (EAIF), while the overall equity contribution of the shareholders was $4.9 million. EAIF is a member of the Private Infrastructure Development Group, which is funded by the UK, Switzerland, Australia, Norway, Sweden, Netherlands, Germany and the World Bank Group.
The Tororo Solar Plant was built close to the Ugandan utility’s loading centres in order to reduce technical electricity loss that can occur with long-distance transmission. The Tororo Solar Plant is connected to one of Uganda’s largest electricity substations. During construction approximately 350 jobs were created on the site, of whom 300 were Ugandan citizens. Permanent jobs have also been created to assist with the operation and maintainance of the facility. As well as its positive impact on the environment and sustainable economic growth, Building Energy is bringing additional benefits to the local community by helping with the building of a school near the solar plant, and providing textbooks to the schoolchildren.
With the Tororo Solar Plant going into operation, Building Energy’s total installed capacity in Africa has risen to 91 MWp. From its Cape Town office, the Company manages and coordinates over 40 projects that are operational and under development in Africa and the Middle East across the technologies of solar, wind and small-scale hydroelectric energy.
“Today we witness an important milestone for Uganda here in Tororo. We see concretely Uganda’s success in switching to clean energy generation, while working together with a well incentivised private sector and its development partners,” says Attilio Pacifici, EU Ambassador designate and Head of the EU Delegation to Uganda. “Despite rapidly rising cost-competitiveness of renewable energy technologies, the financing of renewable energy projects is still difficult in many parts of the world. GET-FiT prefigures the approach the EU with its Member States want to promote with the ambitious new External Investment Plan (EIP). One of the key objectives of this plan is to encourage private sector participation in higher risk investments and we are happy to demonstrate today that Uganda is well positioned to be successful and a good model for replication.”
“We are glad that the first photovoltaic park we have built in Uganda has gone into operation, and to celebrate with the whole Tororo community through this Inauguration ceremony.” says Matteo Brambilla, Managing Director Africa and Middle East at Building Energy. “We are also proud to be making our contribution to more sustainable economic growth in the country through the provision of reliable, good-value electricity. At 18.2%, Uganda’s average electrification level corresponds to one of the world’s lowest per capita electricity consumption rates. The Tororo photovoltaic park makes it possible not just to provide electricity to the local community, but also act as a driver of the city’s industrial development.”