United States signs $217 million agreement to build new electricity plant in Sierra Leone

Sierra Leone Telegraph: 28 July 2021:

The United States International Development Finance Corporation (DFC) says it has committed to provide $217 million in debt financing for a new 83-megawatt power plant to be established in Freetown, Sierra Leone. This is equivalent to the entire capacity of the Bumbuna Hydro-electricity Plant in the north of the country. (Photo above: USA Ambassador Reimer).

The Western Area Power Generation Project (WAPGP), sponsored by Milele Energy and TCQ Power Limited which has been in the pipeline since 2012 under the former government of President Ernest Bai Koroma, will generate and sell electricity to the Electricity Distribution and Supply Authority (EDSA) based on a 20-year power purchase agreement if it comes to fruition.

“DFC’s investment will substantially increase access to energy for people all across Sierra Leone, providing power generation to meet approximately 24 percent of projected electricity demand in a country where only 15 percent of the population has reliable access to power,” said David Marchick, DFC’s Chief Operating Officer.

“This highly developmental project represents the United States’ long-term investment in Sierra Leone’s future. We also look forward to working on Sierra Leone’s transition to renewable energy sources like solar and wind power,” he said.

United States Ambassador to Sierra Leone – David Reimer said: “This plant will increase Sierra Leone’s generation capacity significantly. The power generated will make substantial improvements in the lives and livelihoods of Sierra Leoneans – allowing households to access power for the first time, students to study at night and health workers to save more lives.

“This project builds on the critical work accomplished during the Millennium Challenge Corporation Threshold Program and will open up the energy sector to more private sector investment.”

“The Government of Sierra Leone, through the President, Brigadier Rtd. Julius Maada Bio, expresses its sincere thanks and gratitude to the lender, the United States International Development Finance Corporation, mentioning that “our presence in the project speaks volumes about our commitment to the development of Sierra Leone.” The Government thanked the Sponsors Milele Power Limited and TCQ Power Limited for their relentless efforts and contribution to the project and in realizing the Country’s National Development Plans.

“The Government is deeply committed to accelerating energy access in the Country. The Government is also pleased that “the project has been re-engineered into cleaner energy that will enhance the nation’s resilience and response to climate shocks by improving the management of climate disaster risks.” The Government commitment to this project as a baseload “will support the country’s post COVID-19 economic recovery by providing electricity to the people of Sierra Leone especially the Western Area, which is a critical part of the recovery process. It also supports the replacement of costly fossil fuel generation plants with low-cost cleaner power, which would free up scarce fiscal resources for other urgent socio-economic needs,” the statement published yesterday by DFC reads.

DFC’s financing of the WAPGP project is contingent upon certain conditions, including that the Government of Sierra Leone enact implementing legislation for the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards under local law. Sierra Leone has acceded to the convention and ratified it, and it is working to pass implementing legislation.

TCQ Power Limited CEO Karim Nasser stated, “the project is a monumental step for the country and will unlock opportunities for all; it also demonstrates the government’s ability to draw private investment into complex infrastructure projects. All this would not have been possible without the government’s implementation of bold and decisive reforms to make the energy sector bankable and our lender’s creativity in finding solutions that helped the project become more bankable.”

“With the signing of the commitment letter, we have moved one step closer to delivering critical and reliable electricity to the people of Sierra Leone,” said Erik Granskog, CEO of Nairobi-based Milele Energy.

“We are grateful to TCQ, who has been working diligently on the Project since 2012 and DFC for quickly appreciating the impactful nature of the Project and being a proactive partner in its advancement. The Government of Sierra Leone has been impressive in its implementation of bold and decisive reforms to make the energy sector bankable, which demonstrates the government’s desire and ability to draw private investment into complex infrastructure projects.”

“The United States Government congratulates the Government of Sierra Leone on the signing of this agreement and the ratification of the New York Convention,” stated Ambassador Reimer.

The project is expected to be commissioned fourth quarter of 2024.

About DFC

U.S. International Development Finance Corporation (DFC) is America’s development bank. DFC partners with the private sector to finance solutions to the most critical challenges facing the developing world today. DFC invests across sectors including energy, healthcare, critical infrastructure, and technology.

DFC also provides financing for small businesses and women entrepreneurs in order to create jobs in emerging markets. DFC investments adhere to high standards and respect the environment, human rights, and worker rights.

7 Comments

  1. Brima Sesay, I believe 99.99 percent of all Sierra Leoneans would agree with your expressed views, particularly your urging of Ambassador Reimer to ensure that the $217 million is not directly handed to the Bio administration, but to have American engineers come over to do the job of helping to electrify the country. The United States might as well kiss the money goodbye if it reaches the clutches of the Bio government.

    I strongly disagree with you, however, in your assertion that Bio is a good man and that it’s those around him that are bad. As far as I know Maada Bio is not brain dead; he knows what is taking place around him; he just lacks the willpower to bring his ministers and others to book for poor performance . The nation never tied him up, gagged him and dragged him to State House. He ran for the presidency and won – he must do his job unconditionally, no excuses. If he has found himself incapacitated or incapable of doing his job, he should step aside. We shall try to get by without him.

    • Mr. Santhkie Sorie, good to hear from you again brother, most often I would like such brilliant people like your kind to be on the air all the times, we are gaining a lot. Sometimes you have to be fair, firm and consistent. When I said that President Bio is a good man but he has some some bad guys around him, it doesn’t mean that he’s 100% clean, likewise the former previous heads of state; Siaka Stevens, J.S. Momoh, Kabba and EBK. Brother all of them are equal in their leadership behaviors. But sometimes we have to play logic, fool yourself to gain wisdom.

      You know what? I don’t want to become useless and unpaid whistleblower or else, there are many secrets in this country that we have discovered from our former leaders in this country and abroad, but at the end of the day who cares? Here is one of the famous Hadith narrated from Prophet Muhammad(PBH) says: “ALL of you are shepherds and each one is responsible for his flock. A leader of a people is a shepherd and responsible for them. A man is a shepherd over his family and is responsible for them. This is a famous Hadith of Prophet Muhammad (peace be upon him) that places responsibility on the shoulder of every mankind”. So if these leaders can be straight and honest with their people, it is good for them, but if not, they will be held accountable in the day of judgement brother. Let’s honor and respect our leaders. Thanks

  2. Fellow Citizens of this great country Sierra Leone, I salute you all, also thanking the divine God for His mercy on our people. The United States signs $217 million agreement to build new electricity plant in Sierra Leone, this is a blessing and I personally pray for the US, may the God mighty continue to protects the country and it’s Citizens from their enemies all over around the globe. This is a huge sum of money. Mr. Ambassador H.E. David Reimer, thank you so much for this initiative but here is my take. I personally don’t want you or your country to handover this fund to the gov’t, if you want everything to go well, bring in your specialists to do the job properly. Bio is a good president but we still have some bad guys around him folks. Again, bless you Mr. Ambassador.

  3. $217 million I dare say is a lot of money. We should feel indebted to the Americans. In recent years one could not help entertaining the feeling that Sierra Leone and indeed Africa were no longer a priority for the Americans – engagement has been minimal. The reasoning behind the turnaround is unclear to people like me who are not versed in foreign policy . We can only make a wild guess: The U.S has woken up to Chinese inroads in Africa, the second largest continent with a youthful population, a vast market for American business and numerous natural resources. To leave all these to Chinese sudden fancies would be a huge mistake, laying the background for Chinese global economic dominance.

    The administration in Washington must have also become aware of the uneasiness which a handful of African leaders now feel about Chinese business tactics whose fundamental aim is to recolonise the Continent in a subtle way through huge loans which allows the Chinese to take over an economy completely because of the lack of the means to repay the loan. This is happening not only in Africa but around the world.

    And so we have a new power play between the Americans and Chinese on the continent. The $217 million loan is not unconnected to that. The question is ,does the government in Freetown have the brains to recognise this and exploit it for the benefit of the country? I doubt it , given the level of corruption they’re known for. The best way the Americans can ensure that the target of the loan (the supply of electricity) is reached is not to hand the money to Bio and his entourage, but to have American engineers on the ground to do the job, otherwise it will disappear like the huge diamonds which have disappeared between State House and Lungi Airport in the past when Siaka Stevens, Joseph Momoh and Earnest Koroma were in power respectively.

  4. I thank the United States of America for their generosity. l hope this gesture will continue in other areas where especially personal development is a necessity. Things like good health care provisions. And that Sierra Leone will learn the practice of national pride by doing all it takes to participate in nation building as that is every citizen responsibility. Not just the government. A little act of contribution goes a great way.

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