June 13 2018

Gigawatt Global Cooperative and ECOWAS sign $1 billion renewable energy deal

Source: Asoko Insight

The US government through solar developer Gigawatt Global Cooperative UA has signed a deal with Economic Community of West African States, ECOWAS to build US $1bn of renewable energy projects in the region.

The U.S. is supporting the project through its Power Africa initiative set up in 2013 under President Barack Obama’s administration, a program that had pledged to invest US $7 billion over five years. The advancement of this deal is an indication that the U.S. Agency for International Development has retained its ability to act even though President Donald Trump has slashed aid budgets and criticized U.S. involvement in poverty alleviation.

“Energy poverty can be eliminated even in smaller or less developed ECOWAS states with the leverage of a regional strategy,” according to Yosef Abramowitz, chief executive officer of Gigawatt Global.

Boost in Electricity System

The deal will help develop the West African Power Pool which is a unit of the ECOWAS that was set up to implement the agreement and create a regional electricity system. The deal also builds on an agreement inked by the U.S. and Israel last year where the two governments pledged to work together to reduce energy poverty in Africa.

According to Israel’s ambassador to Nigeria,Guy Feldman,the signed memorandum of understanding indicates that Gigawatt Global will install 800MWof solar and wind farms in Burkina Faso, Senegal, Mali, Nigeria and Gambia.

The project development is planned to kick off in early 2019, including feasibility studies, training courses and the signing of power purchase agreements.

“This MOU signed is a powerful metaphor to the West and the rest of Africa, which pave the way for future Israeli innovation,” said Feldman.

Power Africa is expected to be a lead source of funds for the projects and is also anticipating to bring in other development banks and investors. The funds are expected to have a split of 80% debt and 20% equity.