Photovoltaic power stations, energy recovery from sugar cane residue biomass, improvement of hotel and shopping centre energy performance, solar roofs on private homes, etc. Almost 400 low-carbon projects have been funded in Mauritius in a wide variety of sectors, thanks to the first two phases of the SUNREF programme.*
A total of €100 million has already been lent to several local banks by AFD, first in 2009 and then in 2014, so that they could mobilize in favour of green energies and sustainable resource management.
Thanks to this programme, these banks have been able to offer loans themselves with attractive conditions (technical assistance and payment of an investment subsidy) to companies and individuals wishing to reduce their carbon footprint and seize the opportunities of the energy transition.
SUNREF I and II have thus led to a saving of over 234,000 tonnes of CO2 equivalent (tCO2e) a year and the creation of 15 megawatts (MW) of renewable energy production capacity. They have enabled their beneficiaries to acquire quality equipment and reduce their electricity bills and the companies have also gained in competitiveness.
Two new ambitions for SUNREF III
SUNREF III, still in partnership with the same banks, MCB and SBM, is intended to continue these efforts, but also to extend the financial and technical support to two new themes: climate change adaptation and gender equality.
Along with the mitigation of greenhouse gas emissions, these Sustainable Development Goals (SDGs) are part of the Paris Agreement, which Mauritius was one of the first to sign and which AFD is committed to promoting in all its programmes. The banks have an essential role to play in achieving these goals.
Now, under the SUNREF scheme, the partner banks will also be able to fund projects that aim to reduce the vulnerability of Mauritius to cyclones and other effects of climate change: the fight against coastal erosion, preservation of drinking water resources, flood management, etc.
In addition, when they apply to SBM or MCB for a green loan, companies will systematically be offered technical assistance to carry out a gender equality assessment of their organization, as well as financial support to implement any investments needed in this area.
Supporting the transformation of local banks
As it wishes to support this type of practice, the European Union is providing a €7 million subsidy to the SUNREF II programme. These funds will be used to finance:
- investment subsidies paid to borrowers once their project is finalised;
- capacity building for the partner banks, provided by the employers' organization Business Mauritius, in particular to allow the environmental assessment of projects;
- technical assistance for companies and households, also to be provided by Business Mauritius, and covering for example the consolidation of loan applications.
Technical support for banks and investors was already a part of the previous phases of SUNREF. It is no doubt one of the reasons for the success of this programme: "SUNREF's support was invaluable in the realisation of our project," acknowledges Charles Harel, CEO of Harel Mallac & Co.
This firm was granted a €4 million loan to build the Solar Field photovoltaic power station in northern Mauritius with its partner Dhamma Energy. "Thanks to this programme, we were able to equip the solar farm with the latest technology," explains Mr Harel.
The solar farm, which opened in 2017, does in fact include a tracking system that orients the solar panels towards the sun, enabling it to produce 20 to 25% more energy than a fixed system. The site is now supplying the Mauritian grid with 3.5 to 4 gigawatt hours (GWh) of green energy a year, whilst also enabling it to save 3,667 tCO2e every year, by importing less coal and oil.
* SUNREF: Sustainable Use of Natural Resources and Energy Finance.
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