This summary covers an investment by Golomoti JCM UK Limited of the UK (JCM) into the project enterprise incorporated in Malawi, Golomoti JCM Solar Corporation Limited. The project involves construction and operation of a new 20 MW alternating current solar photovoltaic (PV) power plant (“the Project”) in Golomoti in the Dedza district of Malawi. The plant will also include a 5 megawatt/ 10 megawatt hour (MW/MWh) battery energy storage system (“BESS”) co-located with the solar PV plant, the first such unit in Malawi. JCM has applied for MIGA guarantees covering up to US$24 million of their investment into the project, which includes equity, quasi-equity, shareholder loans and future profits. The guarantees will have a term of up to 20 years, providing coverage against the risks of transfer restriction, and breach of contract. MIGA’s risk exposure under the guarantees is proposed to be shared with the IDA Private Sector Window (PSW) under the MIGA guarantee facility (MGF).
The project has the potential to improve reliability of electricity service in Malawi, as the use of solar power during the day will conserve hydropower resources to be used during peak demand periods in the evening. Malawi currently experiences severe shortages of energy, exacerbated during the dry season when dispatch from hydro plants is often just 50% of capacity. The project, including the introduction of battery storage for the first time in Malawi, will help diversify Malawi’s energy mix away from its current reliance on hydro, supporting resilience. Improved electricity availability to private companies will contribute towards alleviating an important constraint to scaling up private investment.