CDC, the UK’s development finance institution, has today announced a €90 million debt investment in the Nachtigal Hydro Power Company (‘Nachtigal’) on the Sanaga river in Cameroon.
This project demonstrates CDC’s commitment set out earlier this year to invest a further £3.5 billion in Africa over the next four years.
Nachtigal is the largest private sector hydro power plant in Africa funded by a project finance structure. It will be one of the lowest cost producers of power in Cameroon, providing affordable energy to consumers and the Government.
CDC’s 18-year loan, which is part of a €1.26 billion financing programme, will support Sustainable Development Goal 7 (sustainable and clean energy), by adding 420 MW of renewable low-cost hydro-electricity generation capacity by harnessing the hydro-power potential of the Sanaga River. Once commissioned in 2024, Nachtigal will produce over 2,900 GWh a year, adding nearly 30% to the country’s installed capacity.
The construction phase for the project will create more than a thousand jobs during construction; with thousands more expected once Nachtigal is operational in the broader, energy-dependent sectors of the Cameroon economy.
CDC first invested in Cameroon over 50 years ago. We have backed multiple local businesses, including those in the energy and infrastructure sectors such as Eneo, and the Kribi and Dibamba power plants. Nachtigal project sponsors are EDF SA of France, the International Finance Corporation, and the Government of Cameroon.
Welcoming the investment, Iain Macaulay, CDC’s Head of Project Finance, said:
“The Nachtigal project brings tremendous benefit to the energy sector of Cameroon by lowering the average cost of production and boosting the generation of much-needed reliable electricity. CDC has worked closely alongside EDF and IFC to help bring the project to fruition. We’re proud of the vital impact Nachtigal will have on the country’s developments and the way in which many DFIs and commercial lenders have been mobilised to make such a large landmark project possible.”
Valerie Levkov, Senior Vice President Africa & Middle East, EDF International added:
“EDF is pleased to count CDC among the leading institutions financing the Nachtigal project. Throughout the process which led to the signing of the financing agreements, CDC has demonstrated a proactive and pragmatic approach. Nachtigal is a transformational project for the Republic of Cameroon, for EDF’s presence in Africa and for institutions like CDC whose mandate is strong development impact.”
CDC is part of the lenders of the €1.2 billion financing package alongside the IFC, African Development Bank, and Proparco. Also supporting the financing are Standard Chartered Bank, Attijariwafa, Société Générale, FMO, DEG, Agence Française de Développement, OFID and the Emerging Africa Infrastructure Fund.
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