Our investment
Description of the investment.
Description of the investment.
We are providing capital to Virunga Energies to finance the construction of new high voltage substations. These are critical to increase transmission capacity from the Matebe and Rwanguba power plants while reducing electrical losses, ultimately improving the power quality for the region.
Impact information
Applies to investments made from 2019 onwards. The tabs in this section define what we expect to achieve through the investment, assessing the potential impact of the investment against six dimensions of impact. You can find more details on our methodology of assessing impact here.
Applies to investments made from 2019 onwards. The tabs in this section define what we expect to achieve through the investment, assessing the potential impact of the investment against six dimensions of impact. You can find more details on our methodology of assessing impact here.
What?
| Impact |
|---|
Improve the supply and reliability of hydro electricity, the investment will Improve living standards for residential households (SDG 7.1, 7.2). Support economic productivity for commercial and industrial business as well as SMEs (SDG 8.5). Take action on climate change by displacing the need for fossil fuel power in instances when grid supply is unavailable or unreliable (SDG 13A). |
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How?
| How? |
|---|
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The installation of the two substations will improve the transmission of power from Virunga’s hydro power plants to customers connected to the Virunga distribution network. Residential customers will benefit as will commercial and industrial businesses and SME customers. |
Who?
| Stakeholder | Geography | Characteristics |
|---|---|---|
| Consumers |
DRC, Goma |
40 per cent of households in Goma say they’re dissatisfied with their electricity service due to unavailability of power (N. Rusaati and L. Espoir, "Electricity Access In Goma And Bukavu City, Democratic Republic Of Congo", June 2023) |
| Firms, distributors, employees |
DRC, Goma |
Under the current transmission network, voltage drops of up to 15 per cent can occur, which damages the equipment and machinery used by businesses. |
| Planet |
N/A |
How much?
| Scale | Depth/Duration |
|---|---|
|
The investment will facilitate the efficient supply of 13.2 megawatts of hydropower to households in Goma. The power supply is set to double by the end of 2024, when the Rwanguba I (14 megawatts) hydro power plant is completed. This makes this substation project a priority, as the higher voltage is critical to distribute the power from Rwanguba I power plant to Goma. The power will directly reach close to 212,000 people in total. |
The Rwanguba I plant is due to be completed at the end of 2024 and with the completion of Rwanguba II in the next five years, Virunga Energies is expecting to supply power to approximately 53,000 households, reaching up to 300,000 people. The high voltage transmission lines and the substations are critical to delivering this power. |
Contribution/additionality
| Contribution/additionality |
|---|
|
Financial additionality: Given the scarcity of capital currently available for transmission and distribution investments in DRC, our financing is highly additional. The flexible loan will be an extension to a current facility and will complement the EU grant to make this project possible. |
Risk
External riskThe risk that the Rwanguba I and II plants aren’t commissioned as planned will reduce the full potential impact the improved transmission system can have. The ongoing conflict in the region poses a constant threat to the operations of the Virunga Energies operations. This risk is aligned to commercial risks and is being absorbed and managed by the company as best as possible. |
Environmental and social information
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Environmental and social summary
A high-level description of the environmental and social aspects of the investment. This may include a summary of key environmental and social risks identified during environmental and social due diligence (ESDD); key elements of an environmental and social action plan (ESAP); or ways in which we plan to support the investee improve environmental and social standards, such as through their environmental and social management system (ESMS); as well as any other priority areas agreed with the investee.
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Environmental and social risk
A risk category rating, which indicates the level of environmental and social risk associated with an investment. For an explanation of the categorisations used, see here. We consistently provide an environmental and social risk category for all investments screened from 2023 onwards.
Environmental and social summary
We are working with the company on the continuous implementation of their E&S policies and procedures with a focus on labour and working conditions, Gender Based Violence and Harassment (GBVH) and climate risk management.
Environmental and social risk
Medium-High
Reporting and Complaints Mechanism
The Reporting and Complaints Mechanism allows anyone outside BII to report alleged breaches of the business integrity or environmental and social provisions of BII’s Policy on Responsible Investing. This includes breaches made by BII, a BII investee, or a portfolio company of a fund in which BII has invested. The Reporting and Complaints Mechanism Rules are available here. Reports and complaints can be submitted by email to reportsandcomplaints@bii.co.uk or by mail. See more details on our Reporting and Complaints Mechanism here.
For any other general enquiries contact us at enquiries@bii.co.uk
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Key facts
- First published
:
When the investment was first published on the website database.
- September 2024
- Last updated
:
When the last quarterly update of the website database occurred.
- September 2024
- Project number
:
An identifier number shared by investments in the same project.
- D6850
- Status
:
The current status of the investment (green flag for active and red flag for exited).
- Active
- Region
:
The geographical region where the country is located. We currently invest in Africa, South Asia, South East Asia and the Caribbean. In 2023, BII’s investment mandate was extended allowing it to invest in regional funds linked to Ukraine, with the majority of activity expected to begin post-war. Investments outside these regions were made prior to 2012 under previous investment mandates.
- Central Africa
- Sector
:
We prioritise those sectors that facilitate development and need our capital the most. Our priority sectors contribute towards many of the Sustainable Development Goals. They range from investing in the power infrastructure that will provide people with better access to electricity, to investing in financial institutions that direct capital to the individuals and businesses that need it the most.
- Infrastructure
- Investment type :
- Debt
- Start date :
- June 2024
- Amount :
- $3.5m
- Currency of investment :
- USD
- Domicile
:
The company or investment fund’s place of incorporation.
- Republic of Congo
We provide capital in the following ways: directly – through direct equity, direct debt, guarantees and other non-intermediated financial instruments; and indirectly – principally through investment funds.
For direct investments and fund investments, this is the date BII committed capital to the investments. This is typically the date on which legal agreements are signed by all parties.
For the portfolio companies of our fund investments, this is the date (either the month or the quarter) on which the fund committed capital to the portfolio company.
For direct equity investments, this is the date at which British International Investment exited the investment.
For debt investments, this is the date at which the final debt repayment was made.
For funds, this is the date at which the fund was terminated.
For underlying fund investments, this is the date at which the fund manager exited the investment.
The total amount committed, per financial instrument, per investment, on the date BII becomes subject to a binding legal obligation to provide funding or assume a contingent liability. This information is provided in US dollars.
For direct investments, this is the amount that BII has committed to the business or project. For fund investments, this is the amount BII has committed to the fund.
The currency in which the investment was made.
- Climate finance
:
Indicates whether the investment is climate finance qualified or partially climate finance qualified and the type of climate finance (adaptation, mitigation or both). We define climate finance using the multilateral development bank (MDB) and the International Development Finance Club (IDFC) Common Principles climate finance methodology. See Common Principles for Climate Mitigation Finance Tracking and Common Principles for Climate Change Adaptation Finance Tracking. We provide the climate finance qualification and type for commitments from 2020 onwards, which is when we launched our Climate Change Strategy.
- Fully qualified
- Climate finance type:
- Mitigation
- First published
