BII partners with Meridiam to fund Rift Valley Energy project.

By Oliver Townsend Jun 25, 2024
BII signs agreement with Meridiam to provide US$15 million to Rift Valley Energy.jpegOrginal image from: https://www.energyglobal.com/other-renewables/25062024/bii-signs-agreement-with-meridiam-to-provide-us15-million-to-rift-valley-energy/

British International Investment (BII), the UK’s development finance institution (DFI) and impact investor, has recently signed an agreement with Meridiam to provide US$15 million with the potential to increase this to US$25 million to Rift Valley Energy (RVE), a renewable energy platform owned and managed by Meridiam. This funding will play a crucial role in supporting RVE’s ambitious investment and development plan for future renewable energy projects in Tanzania. This partnership will contribute to increasing the national grid’s supply of sustainable and affordable electricity to businesses and communities in low-income areas in rural Tanzania.

Supporting Renewable Energy Projects in Tanzania

The agreement between BII and Meridiam will focus on financing and installing new wind and hydropower capacity in Tanzania. These projects will complement RVE’s existing run-of-river hydropower projects and the only operational wind farm in Tanzania, Mwenga Wind. RVE, a Tanzania-based renewable energy infrastructure development company, is wholly owned by Meridiam, an independent investment Benefit Corp. and asset manager specializing in sustainable public infrastructure development.

Meridiam’s acquisition of RVE in 2023 reflects its commitment to growing generation assets in the region. Currently, RVE owns, operates, and is developing a portfolio of 30 MW of renewable energy generation in the Southern Highlands of Tanzania. Additionally, Meridiam has recently invested in 100 MW of wind assets in Kenya, expanding its regional footprint in renewable energy.

Impact on Tanzania’s Electrification Rate

With a national electrification rate of only 37% in Tanzania and as low as 24% in rural areas, the funding from BII is expected to support an additional 7.6 MW of new renewable energy assets. This increase in renewable energy capacity will provide power to approximately 170,000 people per year and connect 4,000 businesses and households to the grid for the first time. The provision of clean and affordable power to local industries is anticipated to create around 1,800 jobs, contributing to economic growth and development in the region.

Strategic Collaboration for Sustainable Investment

BII’s Chief Executive Officer, Nick O’Donohoe, emphasized the importance of providing access to energy for millions of people in Tanzania. He highlighted the agreement with Meridiam as a significant step towards improving the lives of rural Tanzanians by empowering various sectors such as education, healthcare, job creation, and industrial productivity through the provision of reliable energy.

Meridiam’s Deputy CEO and Africa Head, Mathieu Peller, echoed the sentiment, stating that Rift Valley Energy aligns with Meridiam’s mission and purpose. The collaboration with BII to support renewable energy projects in Tanzania reflects their confidence in the market and commitment to sustainable investment in the region.

Conclusion

The partnership between BII and Meridiam to provide funding to Rift Valley Energy underscores the importance of sustainable energy development in Tanzania. By supporting renewable energy projects, the collaboration aims to improve access to electricity, create jobs, and enhance economic opportunities in rural areas. This strategic investment will not only benefit the local communities but also contribute to Tanzania’s economic growth and development in the long run.

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