Access to electricity in Maputo and Cabo Delgado's peri-urban areas

Access to electricity in Maputo and Cabo Delgado's peri-urban areas

Technical note

 

Financing
 French Development Agency
Beneficiary
Republic of Mozambique
Amount of the loan
20 M €
Date of approval
November 4, 2009
Signature of the Convention
To be signed

 

Objectives

The project aims to improve population's quality of life and to reduce inequalities in the peri-urban areas of Maputo and Cabo Delgado Provinces, by an extended access to improved electricity in these highly populated areas. It also aims at supporting the energy sector development by supplying technical support to the national electric utility - EDM (Electricity of Mozambique).
 

Content of the project

The $ 20M AFD financing lies within the scope of the national energy programme prepared by the Mozambican Government and named NEDAP (“National Energy Sector Development and Access Programme”). Totalising $ 219 M, this programme covers the whole sector (access to electricity in urban, peri-urban and rural areas, renewable energy, stakeholders’ capacity building), in five provinces of the country and is supported by several donors (AFD, World Bank, European Investment Bank, OFID and Arab funds) which agreed on coordinating and harmonizing their respective supports. 
 
AFD loan celebrates the resumption of French loans to the Mozambican State [1] and is twofold:
 
 (I) an “Electrification” component, in the peri-urban areas of Maputo and Cabo Delgado Provinces, which will allow the extension of the distribution network and the connection of almost 47.000 new consumers in the Provinces;
 
(II) an EDM “capacity building” component, particularly planning, through trainings, update of the network development plan and the elaboration of a feasibility study for a priority energy generation project.
 
Financing plan
This 5-year project financing plan is as follows:
 

 

Financing
Amount in $ M
AFD Loan
27,0
World Bank loan
80,0
EIB Loan
46,8
OFID loan and Arab Funds
38,0
Mozambican Government
27,3
TOTAL
219,1


 

If NEDAP program is structured around parallel financings, harmonization and coordination between donors will be systematically searched, to facilitate project implementation and to limit the transaction costs for the Mozambican public institutions in charge of project execution.
 

Expected results

 
It is expected that the project will bring several positive results in terms of economical, social, environmental and institutional development.
 
The program as a whole will improve and increase access to electricity for the most disadvantaged in peri-urban areas, benefiting nearly 300.000 people. This project would improve the living conditions of these populations and facilitate the development of economic activities and create jobs.
 
Moreover, the project will contribute to reduce fossil energy or households charcoal consumption in peri-urban areas which are energies harmful for the environment as well as for pubic health.
 
Lastly, the project will reinforce EDM capacity in the definition of its strategies and priorities, in a country and region where the energy issue is becoming more and more important.

 

 

[1] In addition to its very strong concessionality, this loan, never used in Mozambique, is counter-cyclical, which gives a possibility to postpone capital repayment due date if an external shock is recorded.