This summary covers an investment by JCM Power International Limited (JCM) and InfraCo Africa Limited (InfraCo) into the project enterprise incorporated in Malawi, JCM Matswani Solar Corp. Limited. The project involves construction and operation of a new 60 MW solar photovoltaic (PV) plant in Salima province of Malawi. JCM and InfraCo have applied for MIGA guarantees covering up to US$59.0 million of their equity investment into the project. 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 will add 60 MW of installed capacity in Malawi, increasing total supply by 16%, and substantially contributing to closing Malawi’s supply-demand gap. The country currently experiences severe shortages of energy, exacerbated during the dry season when dispatch from hydro plants is often just 50% of capacity. The project will therefore help diversify energy source away from hydro, by adding another renewable source in the mix. Improved electricity availability to private companies will contribute towards alleviating an important constraint to scaling up private investment. The project will be a first Independent Power Producer in Malawi and therefore will create a demonstration effect for future foreign investments in the energy sector of Malawi.