CEN EBL

hold

The proposed IFC investment consists of an equity bridge loan (EBL) for up to US$60 million with a tenor of up to 5 years to Globeleq Africa Holdings Limited (GAHL), the holding platform of Globeleq (GQ). Founded in 2002 and headquartered in the UK, Globeleq is a leading power generation project developer focusing on Africa. GQ is owned 70 % by BII and 30% by Norfund, which are DFIs owned by the UK and Norwegian governments, respectively. GQ operates 1.8GW of power generation in Africa across different technologies (solar PV, wind, gas-HFO fired). The proceeds of IFC’s EBL will solely support the development of Namaacha, described below.The proposed Namaacha wind Independent Power Producer (IPP) is being developed by Central Eléctrica da Namaacha (CEN), a Special Purpose Vehicle owned by Globeleq Mozambique Renewables Holdings, a subsidiary of Globeleq (GQ or the Lead Sponsor), Source Energia, and Electricidade de Moçambique (EDM) (together, the Sponsors). This will be the country’s first wind IPP project. It consists of the development, financing, construction, operation, and maintenance of a 120MW Wind Energy Farm (WEF) located in Namaacha, 57km west of Maputo in Mozambique (the Project). The Project will sell electricity under a 25-year Power Purchase Agreement (PPA) to EDM, the state-owned buyer and offtaker. EDM will export CEN’s output to the Southern African Power Pool (SAPP) until existing generation in Mozambique can no longer meet domestic demand (expected in 2031).The Project will consist of 20 Wind Turbine Generators (WTG) each with a unit capacity of 6MW with a 120m hub height. CEN will evacuate power by way of the Transmission Connection Equipment (TCE) consisting of i) a new 33.5km transmission line (T-Line) with two single circuit 66kV parallel overhead lines to be connected to the Boane substation; ii) a 27MVar STATCOM system for voltage stabilization in case of complete WEF tripping; and iii) an upgrade to the Boane substation’s 66kV busbar. The TCE is considered a Project component and will be financed by the Project, but the Boane substation is considered an Associated Facility as per IFC Performance Standards (PSs). The Project’s construction will be undertaken under a Turbine Supply Agreement (TSA) and a Balance of Plant (BoP) contract to be fully wrapped by an interface agreement (together, the EPC Contracts). The selection of the turbine supplier and BoP contractor is expected to be finalized in May-2024. The O&M services will be delivered to CEN under a 25-year Long-Term Service Agreement (LTSA) and a BoP maintenance contract, to be provided by the turbine supplier and GQ Energia Moçambique (GEM), GQ’s subsidiary providing O&M services on GQ-owned assets in Mozambique, respectively. Construction is expected to last 21 months, with the WTGs commissioned after 18 months and the entire WEF (incl. the TCE), 3 months thereafter. The TCE’s construction will fall under the Scope of Work (SoW) of the BoP contractor.  Additional infrastructure will include underground medium voltage transmission cables (33kV) connecting the WTGs with the subordinate substation, a fiber-optic communications network to connect to a Supervisory Control and Data Acquisition (SCADA) system, onsite building infrastructure required for the daily operation of the Project including administrative buildings, a control room, a workshop, a storage warehouse, and a road network to assist the installation of the WTGs during construction and operations. The two parallel 66 kV T-Lines (spaced 20m apart) will be installed on c. 169 monopole towers within a 70m corridor for the first 29km and then on a single line within a 50m corridor on an existing EDM servitude corridor. In the last 310 meters before reaching the Boane substation, the transmission line will be buried with underground cables, to avoid physical displacement of peri-urban dwellings. Namaacha is the closest town, the WEF site is located approximately 10km to the north, in the South of Mozambique, near the country’s borders with South Africa and eSwatini. The WEF site is predominantly rural and underdeveloped area of 855.6 Ha, being used mostly for livestock grazing. A provisional land use right, Direito do Uso e Aproveitamento da Terra (DUAT), was granted for CEN in Mar-2019 by local authorities. A permanent DUAT was granted in Apr-2024 for the WEF. The Project will require physical and economic displacement on both the WEF and the T-Line (please refer to the PS5 section for further details). The Project is located within the Maputaland Coastal Forests and Woodlands, and Limpopo Lowveld ecoregions. It is sited on a plateau and characterized by grassland with scattered trees and shrubs interspersed with patches of forest following drainage routes. It does not overlap with any legally protected areas but is within the Lubombo Transfrontier Conservation Area, approximately 3km from the Namaacha and Hlane - Mlawula Complex Key Biodiversity Areas (KBAs) and overlaps with the Namaacha Tropical Important Plant Area. A wide range of raptor species, including three that are globally threatened use the airspace over the project and surrounding landscape.