Africa has the world's largest untapped potential in hydropower, and several new projects are underway to help meet future energy demands
A number of new hydropower projects and upgrades are being developed across Africa, as the continent seeks to increase its energy potential and unlock greater access to electricity. International Water Power & Dam Construction (IWP&DC) magazine takes a closer look at these recent hydropower developments, and how they are being funded.
Africa has an installed hydropower capacity of over 37 gigawatts (GW) and the highest untapped potential across the world. The continent has so far only utilised around 11% of its capacity, with 906 megawatts (MW) placed into operation last year (2020 IHA Hydropower Status Report).
As electricity demand is expected to triple by 2040, the spotlight has been placed on potential new developments, as well as the refurbishment and upgrading of existing projects across the region.
Recently, a number of projects across the continent have received funding to help with their development.
Recent hydropower developments in Africa
Bumbuna Hydro II in Sierra Leone
InfraCo Africa, part of the Private Infrastructure Development Group (PIDG), has signed an agreement with lead developer Joule Africa to provide the funding, which forms part of a package involving the private sector and development finance institutions, designed to ensure that Bumbuna Hydro II can reach construction and operation goals.
“As part of the PIDG, InfraCo Africa is uniquely positioned to be nimble and flexible, providing timely development capital and expertise at any point in the lifecycle of a project,” comments InfraCo Africa’s CEO, Gilles Vaes.
“Often we are needed in the early stages to develop a concept or prove a pioneering model but, as in the case of Bumbuna Hydro II, we can also come in at a later stage to help with the critical and final push across the finishing line and participating in the project’s steering committee, particularly in these challenging times.
“Bumbuna Hydro II is expected to have a tremendously-positive impact, powering sustainable economic development in Sierra Leone.”
The project is being delivered by renewables developer, Joule Africa, through local project company Seli Hydropower. Located on the Upper Seli River, 230km north east of Sierra Leone’s capital, Freetown, the Bumbuna Hydro II project will enable distribution of significant additional power to the national grid. It is expected to begin construction in 2021.
“InfraCo Africa’s commitment to Bumbuna Hydro II and Joule Africa comes at a crucial stage for us as we enter the last lap in the development of the Project,” explains Paul Kunert, CEO of Joule Africa. “With InfraCo Africa’s commitment and a respected equity partner shortly to come in, we now have the funding in place to reach financial close next year.
“We’ve been working with PIDG over a number of years and we’re delighted to be able to expand that relationship with InfraCo Africa today.”
InfraCo Africa said it is committed to supporting the Government of Sierra Leone’s National Renewable Energy Action Plan. This new investment into the country’s renewable energy sector complements InfraCo Africa’s work elsewhere in the country to develop the pioneering Sierra Leone mini-grid project.
Delivered across 41 sites, Sierra Leone mini-grid will roll out off-grid solar technology at scale, delivering clean, first-time power for remote homes and businesses.
Bumbuna Hydro II also exemplifies the capacity of the wider PIDG to engage with, and support, projects from concept to commercial reality. PIDG’s Technical Assistance (PIDG TA) supported the project’s early development via returnable and technical assistance grants to fund an embedded advisor to the Government of Sierra Leone. The involvement of PIDG company, the Emerging Africa Infrastructure Fund (EAIF), has also been central to enabling the project to progress to this stage.
Sendje in Equatorial Guinea
It was also recently announced that the Development Bank of Central African States (BDEAC) has signed a loan agreement worth FCFA 80 billion with the Government of Equatorial Guinea to fund the construction and operation of the 200MW Sendje hydroelectric plant.
Once developed Sendje, located 40 km from the city of Bata, will supply all cities in the mainland of the country with clean and sustainable energy.
The project also has many other benefits. Socio-economically, it will help reduce the average price per kilowatt hour, with a substantial gain for subscribers. Commercially and financially, it will increase the rate of connection to the country’s electricity network, and make up for the electricity deficit which is paralysing the economic growth of the country in general, and of the mainland in particular.
On the environmental level, it will contribute to the reduction of dependence on fuel-oil thermal production units, by integrating renewable energies into the electricity production system, improving the carbon footprint of Equatorial Guinea.
Sahofika in Madagascar
A €4.02m loan with a grant component has been awarded by the African Development Fund to the 205MW Sahofika hydropower project in Madagascar.
The Sahofika project is located on the Onive River, 100 km southeast of the capital Antananarivo. It entails the construction of a hydroelectric power plant on a Build-Own-Operate-Transfer basis, and includes the construction and rehabilitation of 110km of access roads and construction of a 75km, 220 kV transmission line.
Once commissioned, the Sahofika project is expected to contribute to the avoidance of 900,000 tonnes of CO2 equivalent annually.
The Government of Madagascar has committed to plough back the returns from the project to reduce electricity tariffs for the people of the country.
Additional funding for the hydropower project is expected to come from the European Union and the Arab Bank for Economic Development in Africa.
Dr Kevin Kariuki, African Development Bank (ADB) vice president for power, energy, climate change and green growth, says: “The support to the Sahofika project exemplifies the bank’s commitment to delivering quality, affordable energy access across the continent for sustainable and inclusive growth, while helping member countries to responsibly harness their vast, yet underdeveloped renewable energy resources.
“As the largest hydropower project under development in the country, the Sahofika project will unlock Madagascar’s hydropower potential, and diversify its energy mix in favour of renewable at 90%.”
In December 2019, acting as mandated lead arranger, the bank approved a partial risk guarantee of $100m towards the Sahofika project to mitigate liquidity risk. It is also supporting the Power Transmission Network Reinforcement and Interconnection Project, aimed at reinforcing and expanding Madagascar’s transmission network in order to evacuate the additional power generated by this large hydro project.
“The Sahofika project is a cornerstone of the bank’s strong support to the power sector in Madagascar,” says Mohamed Cherif, the African Development Bank’s country manager for Madagascar.
“The commissioning of Sahofika would enable national utility (JIRAMA) to save around €100m annually in fuel costs, while phasing out the need for state subsidies.”
The Sahofika project is aligned with the bank’s New Deal on Energy for Africa, and its Climate Change Action Plan, whose collective goals include expanding green-energy infrastructure for sustainable and inclusive growth. It is also in line with the Government of Madagascar’s energy policy.
The African Development Fund is supporting hydropower in Africa
The African Development Fund (ADF) is the concessional financing window of the bank group that provides low-income Regional Member Countries (RMCs) with concessional loans and grants in support of projects that spur poverty reduction.
In April this year, the ADF-managed Sustainable Energy Fund for Africa (SEFA), approved a $760,000 grant to Empower New Energy AS (EmNEW), to develop at least eight small renewable energy projects, including hydro with capacity ranging from 1-10MW, towards bankability and construction.
The grant will support a broad range of project preparation and development activities, including technical feasibility studies, legal due diligence, environmental and social impact assessment, quality assurance and risk management.
Through its Empower Invest fund, EmNEW invests in small and medium-scale renewable energy projects in Africa, with a focus on solar power, hybrid, and hydropower technologies.
Welcoming the approval, Terje Osmundsen, EmNEW’s CEO, says: “We are very excited to be entering into a partnership with the African Development Bank and SEFA. There is a large number of strong small or medium-scale projects across Africa that remain unrealised because they can’t access competitive financing.
“Our approach allows us to bridge this gap and working with SEFA will help us to accelerate this process and support more high-quality projects. Together, we can bring impactful investment to Africa, while helping the continent to meet its electrification, carbon-reduction, and sustainable-development targets.”
The ADB’s support to EmNEW through SEFA is fully aligned with SEFA’s strategy to tackle challenges faced by smaller renewable energy projects in many African countries in accessing financing to cover their initial development costs, the bank’s acting director for renewable energy and energy efficiency Daniel Schroth notes.
Drawing on high-quality local partnerships in Africa, EmNEW invests in renewable energy projects through competitive equity to small and medium-scale projects, which helps to reduce the time and resources required to finance projects while delivering environmental and social impact.
“Accelerated deployment of distributed solar power and small hydropower is one of the fastest and most cost-efficient ways to bridge the energy-access gap, fight climate change and promote sustainable development in Sub-Saharan Africa,” said Wale Shonibare, ADB’s acting vice president for power, energy, climate and green growth.
Funding for the Kaptis hydropower project in Kenya, East Africa
Earlier this year, it was announced that Private Infrastructure Development Group (PIDG) company, Emerging Africa Infrastructure Fund (EAIF), had been appointed joint-mandated lead arranger of the $30m debt-finance package being raised by Tembo Power to build the Kaptis hydroelectric power plant in Western Kenya.
EAIF, through its manager, Ninety One, will work alongside Finnfund as JMDA. Finnfund, like EAIF, is an impact investor.
Tembo Power, together with its partners Metier and WK Power, will inject some $14m in equity. Tembo Power aims to have the new plant operational in late 2022.
“I am pleased to welcome EAIF and Finnfund to our consortium for the actual construction of Kaptis,” says Tembo Power’s founder, Raphael Khalifa. “These two lenders are major players in the African infrastructure sector with specific knowledge of Kenya’s regulatory environment and demonstrated success in financing small hydropower projects in Sub-Saharan Africa.
“This is another significant step towards financial closing later this year.”
Investment director at EAIF manager, Ninety One, Paromita Chatterjee, adds: “EAIF is delighted to have been appointed the lead arranger of the debt finance for the Kaptis hydro electricity project. The Fund, with PIDG, brings a unique combination of patient lending, deep knowledge of infrastructure finance and a record of commitment to renewable energy.”
Neckartal Dam in Namibia
It’s not just new funding for hydropower in Africa that has made the news. This year has seen the commissioning of new projects. In March, it was announced that the Neckartal Dam – the largest dam in the southern African country of Namibia – had officially been inaugurated.
The roller compacted concrete (RCC) dam, which was built by Salini Impregilo, is considered fundamental infrastructure that will provide water for Namibia’s desert. It will irrigate 5,000 hectares of land, promoting agriculture and employment.
The dam is located 40km west of Keetmanshoop, in the Karas region in the southern part of Namibia. The infrastructure is part of the first phase of the Neckartal Irrigation Scheme (NIS), which through irrigation will guarantee the area’s agricultural development, especially for cultivating products such as lucerne, grapes and dates.
The water will be provided by the dam, subsequently flowing downhill for 13km, until it finally reaches an extraction well. The NIS water supply system will then transport it to the irrigated areas, and then to single agricultural areas.
The dam is 78.5m high and 518m long. By using the waters from the nearby rivers, it has a storage volume of 857 million cubic metres of water, over a 39-square-kilometre area.
The dam was built with over 1.1 million hours of zero lost work day injuries, since July 2018 – a record-breaking feat in terms of health and safety. In Keetmanshoop and in the nearby areas, a total of 5,500 jobs were also created: 3,000 workers were hired directly and 2,500 indirectly. 65% of these workers came from the Karas region.
When the irrigation of the nearby areas will have reached its peak potential, an additional 4,000 jobs will be created (directly and indirectly). The dam, besides contributing to producing food for the region’s farming, will also have a positive impact on tourism and the economy in general of Keetmanshoop and nearby areas.
Ruo-Ndiza in Malawi
In the area of small hydro, Gilkes announced earlier this year that its hydro engineering team completed commissioning of the 8.2MW Ruo-Ndiza hydroelectric power station in Mulanje, Southern Malawi.
The run-of-river project, on the river Ruo at the foot of Mount Mulanje, was carried out on behalf of Mulanje Renewable Energy (MRE) in two phases over two years.
The first phase of the project was installed and commissioned in 2018 with a 3.3MW Pelton turbine using the flow from the river Ndiza, with two further 3.3MW Pelton Turbines installed and commissioned earlier this year harnessing the flow of the river Ruo.
The schemes are located on the Lujeri tea estate, where Gilkes has a long history of hydropower, installing turbines here as far back as 1934.
The company also received another order from a private developer in Malawi for the supply and installation of a 3MW Turgo turbine and associated electro-mechanical equipment. The plant will supply power to the main grid.
Polihali Dam in Lethostho and the LHWP
Excavation work started in June on two diversion tunnels, which form an important part of the Lethostho Highlands Water Project (LHWP) Phase II, the Lesotho Highlands Development Authority (LHDA) announced.
The two tunnels will divert the waters of the Senqu River away from the natural river bed, creating a dry foundation and work area needed for the construction of the Polihali Dam.
Tente Tente, chief executive of the LHDA, confirmed that the construction of the diversion tunnels is an important element of the Phase II advance infrastructure works which were halted during the Covid-19 lockdown period.
He says: “We are pleased to see construction work restarting, including the work on the diversion tunnels. However, particularly at this time, the LHDA’s priority is the safety of its employees and the project-affected communities.
“Full resumption of the Phase II advance infrastructure construction works and the project’s social and environmental programmes will be incremental as consultants and contractors meet their Covid-19 mitigation obligations and travel restrictions are lifted.”
The diversion tunnels will take approximately 18 months to complete, from the contract start date. Building two tunnels will increase the capacity to carry floods and will provide flexibility to work in one tunnel while the river flows in the other one.
The tunnels – one seven metres in diameter and almost a kilometre in length, and the second nine metres in diameter and similar length – run parallel to each other from the intake point to the outlet downstream of the dam. They will be excavated by drill and blast method, and will be supported by rockbolts and shotcrete as required.
SCLC Polihali Diversion Tunnel Joint Venture was awarded the diversion tunnel construction contract in April 2019. It comprises South African and Lesotho expertise: Salini Impregilo S.p.A (South African branch), Cooperativa Muratori Cementistri CMC di Ravenna (South African branch), LSP Construction (Pty) Ltd (Lesotho) and CMI Infrastructure Ltd (South Africa).
The Metsi a Senqu-Khubelu Consultants Joint Venture (MSKC), which also includes a number of South African and Lesotho-based firms i.e. Aurecon (SA), Knight Piesold (SA), Hatch Goba (SA), SMEC (SA) and FM Associates (Lesotho), designed the diversion tunnels and is supervising the construction work.
Phase II of the Lesotho Highlands Water Project builds on the successful completion of Phase I in 2003. It delivers water to the Gauteng region of South Africa and utilises the water delivery system to generate electricity for Lesotho.
Phase II will increase the current supply rate of 780 million cubic metres per annum incrementally to more than 1.27 billion cubic metres per annum. At the same time, it will increase the quantity of electricity generated at the ‘Muela hydropower station, and is a further step in the process of securing an independent electricity source to meet Lesotho’s domestic requirements.
The hydropower further feasibility studies confirmed that conventional hydropower is the preferred option for the Phase II hydropower component and identified three potential sites.
Dama and Siguvyaye hydropower projects in Burundi, East Africa
In June, it was announced that Tembo Power is partnering with WK Construction to carry out detailed studies for two new hydropower projects in Burundi, East Africa.
The projects – 7.5MW Dama and 12MW Siguvyaye – are expected to cost about $50m to develop and are on track to reach financial close in the third quarter of 2021.
A deal has been struck to give WK Construction the status of preferred Engineering Procurement and Construction (EPC) contractor, while its investment arm, WK Power, will retain a minority equity stake in the projects.
“We are delighted to pursue our partnership with WK Construction into Burundi, as this will allow us to leverage the experience gained together in Kenya and fast-track the detailed studies development phase prior to financial closing,” says Raphael Khalifa, founder of Tembo Power. “WK Construction is also a leading pipeline contractor, which makes it an ideal partner for the Burundian projects, which consist in high heads and low-rated flow.”
The Dama and Siguvyaye projects are currently in the permitting phase.
Aurecon, a South African engineering firm and a strategic technical partner of Tembo Power, has conducted the feasibility studies, including geotechnical and geophysical surveys. Trinity LLP is advising Tembo Power on the legal aspects to finance the projects according to international project financing standards.
“At WK we are excited to be extending our partnership with Tembo and expanding the footprint of hydropower projects that we are involved within East Africa,” says Karl Kusel, WK Construction CEO. “These projects add to our existing projects in Uganda and Kenya. WK firmly believes the project partners complement each other’s skillsets and make a formidable team to develop these projects.”
KenGen in Kenya
Multiconsult has been tasked with conducting a pre-feasibility study for floating solar PV (F-PV) potential on three main dam reservoirs for KenGen in Kenya. The project, which will contribute to a more flexible and sustainable energy system in Kenya, includes the Kamburu, Kiambere and Turkwell reservoirs.
In the project, which is funded by the German development bank KfW, Multiconsult will review the power infrastructure at the sites, assess hydro turbines characteristics, operation of the reservoirs, water-flow patterns and power evacuation in the grid, as well as provide recommendations about the integration of F-PV in hybrid operation with the existing infrastructure.
The social, environmental and climate aspects and associated risks will also be assessed.
“Numerous benefits will be realised by this project,” explains Syed Ali, senior advisor and project manager at Multiconsult. “The hybrid operation of the dams with floating solar PV will facilitate the management of power and water usage in an appropriate and cost-effective way, in addition to water savings due to less evaporation from the reservoir.
“Kenya has abundant solar resources, which means solar power can be used during daytime when sun is abundant, and hydro power during peak times in the evening. This may reduce reliance on conventional and oil/coal fired power plants and thus reduce carbon emissions.”
The power production of these large hydro dams may be affected by climate change, such as larger variations in water inflow and more extreme weather. Such a scenario will affect the water levels in the reservoirs and water management could become more challenging.
Hybrid hydropower-connected F-PV plants in the existing dams could offset the loss of electrical production due to variation in water levels. Furthermore, hybrid F-PV and hydropower plants could facilitate grid-integration cost savings by utilising the same grid connection.
Large-scale F-PV plants can also reduce the evaporation rate of water, which may result in saving of water as well, according to Ali.
Multiconsult vice president of energy systems Ryan Anderson adds: “We believe that the future of power systems in many African countries will rely on low-cost variable renewables working together with reliable and flexible hydropower reservoirs.
“Multiconsult intends to help its clients to be at the forefront of this development. It is exciting that KenGen, with support from KFW, are looking to be a path-breaker for the continent in this regard.”
This article originally appeared in International Water Power & Dam Construction magazine