U.S. Development Finance Corporation extends technical assistance facility for Volobe Hydro Power Plant development in Madagascar

• 120MW hydropower project to provide a major boost to Madagascar’s power generation capacity
•  Volobe project supports the Government of Madagascar's target of reaching 75% renewable energy sources by 2030

Antananarivo, Madagascar - 20 September 2024 - The U.S. International Development Finance Corporation (DFC) has approved technical assistance funding to support the development of the pioneering 120 MW hydropower project in Madagascar. The announcement was made on the sidelines of Africa50’s General Shareholders Meeting (GSM) in Antananarivo.

The new technical assistance facility is a significant milestone that underscores the strategic cooperation between DFC and Africa50 and a shared commitment to scale innovative and climate-resilient infrastructure across the continent. The project company will deploy the funding into expediting project development activities, accelerating the project's path to financial close.

Volobe, the 120 MW run-of-the-river hydroelectric power plant, will boost the supply of stable and affordable power to millions of people in Tamatave and the capital city, Antananarivo through a transmission line under construction of c. 270 KM. The Volobe project will increase the country’s electricity generation capacity by approximately 20%, bringing clean energy, jobs, and productivity gains to Malagasy businesses and individuals across the country. The project is managed by the Compagnie Générale Hydroélectrique de Volobe (CGHV) which has Axian and Africa50 as shareholders.

Once operational, the hydropower plant is expected to generate substantial cost savings for JIRAMA (the Malagasy state-owned utility company) and will significantly contribute to Madagascar’s climate agenda.

Volobe will be located on the Ivondro River, approximately 30 kilometres from the eastern city of Toamasina, the second largest city in Madagascar. The project harnesses Madagascar's extensive hydroelectric potential, estimated at approximately 7.8 GW. Over 800 hydropower sites with high untapped potential have been identified across the country.

DFC Deputy Vice President of the Office of Development Policy, Christopher Walker, said:“DFC is proud to support Africa50 in their efforts to advance the development of the 120 MW run-of-the-river hydroelectric power plant which will positively impact many of Madagascar’s citizens for generations to come. Expanding access to electricity has long been a priority for DFC and our partners. Investments in energy provide people and businesses with reliable and secure sources of electricity to drive development, promote economic growth, and advance job creation.”

Remy Huber, CEO, CGHV, said: “The Volobe project is advancing with all stakeholders and sponsors working towards completion. This determination is reflected in the agreement with DFC, which marks a crucial step towards financial closure, expected in 2025. Thanks to its multifaceted nature, the Volobe project balances sustainability with inclusive economic growth, meeting the expectations and needs of both local communities and industries”.

Anas Charafi, Senior Investment Director, Africa50, said: "This technical assistance funding by DFC is testament to the strength and strategic importance of the Volobe project which we are jointly developing with Axian. It will help expedite the development of the project, which will support industrialization and play a key role in decarbonizing the energy sector. Africa50 mobilizes local and global capital at scale and, working hand in hand with our strategic partners, we aim to fast track the execution of transformative infrastructure projects”.

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Notes to Editors

Photo Credit - AfDB

From left to right: Remy Huber, CEO, CGHV and Christopher Walker, DFC Deputy Vice President of the Office of Development Policy

About Africa50

Africa50 is a pan-African infrastructure investor and asset manager that contributes to Africa's growth by developing and investing in bankable projects, catalysing public sector capital, and mobilising private sector funding, with differentiated financial returns and impact. Africa50 currently has 35 shareholders, comprised of 32 African countries, the African Development Bank, the Central Bank of West African States (BCEAO), and Bank Al-Maghrib. For more information, visit: africa50.com.

About DFC

The U.S. International Development Finance Corporation (DFC) partners with the private sector to finance solutions to the most critical challenges facing the developing world today. We invest across sectors including energy, healthcare, infrastructure, agriculture, and small business and financial services. DFC investments adhere to high standards and respect the environment, human rights, and worker rights.

ABOUT CGHV

The CGHV (Compagnie Générale d'Hydroélectricité de Volobe) is a Malagasy company. It was established in 2016 for the development of the Volobe hydroelectric project. CGHV is responsible for the development, construction, management, operation, and maintenance of the Volobe Amont hydroelectric plant throughout the duration of the concession.

Media contacts:

Africa50: Nana Boakye-Yiadom, Senior Communications Coordinator, Africa50, n.boakyeyiadom@africa50.com ; +212666166308

DFC: Press@dfc.gov

CGHV: Enick Razafindrakoto, enick.razafindrakoto@cghv.mg

Category: Press Release