Brussels, 22/12/2010 (Agence Europe) - The European Investment Bank (EIB) has made three loans to Africa in the energy sector and in water infrastructure.
US$ 135 million will go to Tanesco (Tanzania Electricity Supply Company) for the electricity backbone project. The loan will be used to finance a new 667 km high voltage transmission line being built by Tanesco between Iringa and Shinyanga. The Tanzania Backbone Interconnector Project will improve electricity transmission from existing and future generating sources in the south of the country to the north. Due to the development of mining activity, the demand for electricity in the north-west of Tanzania is growing fast, at a rate of 10% per year. The existing transmission line has reached its technical limit to carry additional power and the planned connections of rural, urban and industrial customers will increase the network overload. The project might also anticipate future interconnections with Kenya in the north and Zambia in the south. The total cost of the project is estimated at €400 million.
€119 million go to the Kenya Electricity Generating Company Ltd for geothermal plant extension. The project area is located some 85 km north-west of the capital Nairobi, partly in the Hell's Gate National Park. It consists of expansion of the existing Olkaria I and new Olkaria IV geothermal power station to increase generation capacity by a further 280 MW (2x70 MW at each of Olkaria I and IV). The project, which is also co-funded by the Agence française de développement, will aim to meet growing demand for electricity at a competitive price, while limiting the impact this has on the environment. Among the economic advantages provided by the project, the EIB cites: - increased power production, improved security of supply, reduced national dependence on imported fossil fuels for electricity production, and additional operational flexibility for existing units at two geothermal power plants.
€50 million for water infrastructure in eThekwini, South Africa. The EIB has also announced its decision to finance upgrading and expansion of the water infrastructure programme for eThekwini Municipality in KwaZulu-Natal. The municipality provides water and sanitation services to nearly four million people in the greater Durban area. The EIB will provide a long-term loan of €50 million, representing 15% of the total investment cost of the programme, to Rand Merchant Bank (RMB), the investment banking arm of FirstRand Bank Limited in South Africa, to allow it to fund the project at reduced rates. The programme includes the replacement of 1,600 km of old asbestos water mains and the construction of two aqueducts. Work will be carried out by the eThekwini Municipality's water and sanitation unit. (O.L./transl.jl)