The Multilateral Investment Guarantee Agency (Miga) of the World Bank has issued guarantees of $24 million (about K24.72 billion) to JCM Golomoti UK Limited.
The money is for equity and shareholder loan investments into Golomoti JCM Solar Corporation Limited for the development, construction, and operation of a new 20-megawatt solar photovoltaic plant.
In a statement on Friday, Miga says the guarantees will extend over 20 years and protect JCM against the risks of transfer restriction and breach of contract.
The plant includes a battery energy storage system—the first in Malawi.
Miga Executive Vice President Hiroshi Matano said his institution is pleased to support ongoing electrification in Malawi and the first deployment of solar battery storage technology in the country.
“By helping to diversify the energy supply, the new plant contributes to Malawi’s transition to a low-carbon and climate-resilient economy,” Matano said.
CEO of JCM Power, parent company of JCM Golomati UK Limited Christian Wray said the support from Miga has been a key aspect of advancing our projects in Malawi.
“The partnership makes it possible for independent power producers like JCM Power to deliver projects that have a positive impact on the renewable energy sector in Africa,” Wray said.
Malawi has among the lowest electricity access rates in the world, just 11.2 percent in 2019.
Most of the existing generation capacity—75 percent is dependent on hydropower (a significant portion of it from Lake Malawi), which makes the country vulnerable to the impacts of climate change and leads to frequent and lengthy blackouts.
Furthermore, peak demand is currently managed by using expensive and polluting diesel generators.
The government of Malawi proposes to increase electrification levels to 30 percent by 2030, seeking to increase electricity supply by new independent power producers and connecting new customers to the grid.
The photovoltaic plant, the second independent power producer in Malawi supported by Miga, adds a new source of clean energy supply that will reduce CO2 emissions by 45,000 metric tons over its life.
The 5 MW/10 MWh battery storage system was installed and made operational at the same time as the plant and has an expected useful life of up to 15 years.