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Burkina Faso

Dedougou Solaire SARL

$6.3 million
Power
Summary of Proposed Guarantee
Proposed

Project Description

Dedougou is a 18 MWp solar photovoltaic (“PV”) plant, being developed by Qair International. The Project entails construction, ownership, operation and maintenance of a 18 MWp solar PV plant and interconnection facilities. The Project is located in Dedougou, located in the department of Dedougou, in the province of Mouhoun, in the Boucle du Mouhoun region in Burkina Faso. The electricity output will be sold to Société Nationale d’Electricite du Burkina Faso (“SONABEL”), the state-owned utility under a 25-year Power Purchase Agreement. A Public Private Partnership agreement has also been signed with the Government of Burkina Faso for a tenor of 25 years.

The Guarantee Holder has applied for MIGA guarantees covering up to 6.3 million euros of equity/quasi-equity/shareholder loans (“EQS”) investments into the project. The guarantees will have a term of up to 20 years, providing coverage against the risk of expropriation, transfer restriction, breach of contract, and war and civil disturbance.

MIGA’s risk exposure under the guarantee is proposed to be shared with the IDA Private Sector Window (“PSW”).  For more information on the IDA18 PSW, please access the IDA18 Private Sector Window website. The PSW involvement will be via a shared first loss facility that will assist in spreading the risk and result in a reduced cost of the guarantee for the project enterprise. The project meets the minimum concessionality principle and the amount of subsidy is estimated to be less than 0.8% of the total project cost over the envisaged 20-year guarantee period.

Environmental Categorization

The project is a category B under MIGA’s Policy on Environmental and Social Sustainability. Click here for the project’s Environmental and Social Review Summary.

Development Impact

The Project is anticipated to be part of the first Independent Power Producers in the country and will bring much-needed clean power to Burkina Faso . As such, it has the potential to demonstrate the viability of solar PV technology and private investment in the country’s power sector, while strengthening the regulatory environment for IPPs. Moreover, the Project has the potential to diversify Burkina Faso’s energy mix, decrease its dependency on expensive and less environmentally friendly fossil fuels, and generate cost savings to consumers and the government. Support for the Project aligns with MIGA’s strategic focus on International Development Association (“IDA”) member countries, fragility and conflict-affected countries, and projects with climate benefits.