Emerging Africa Infrastructure Fund, a $365 million debt fund, will provide $14 million in senior debt to US-based renewable power generator SAEMS for a hydro power project in Mpanga. The fund will also provide $35 million to Tronder Power, a subsidiary of Norway-based power company TrønderEnergi, to develop a hydro electric power project in Bugoye.
The two hydro projects will help plug Uganda’s power supply deficit, ahead of the construction of Bujagali Hydropower Project, a larger power generation facility. They will cost less than thermal plants that rely on imported oil and produce less carbon emissions, the firm said.
Uganda’s limited power supply currently hinders the country’s economic development.
Founded in 2002 by the governments of the UK, Netherlands, Switzerland and Sweden, Emerging Africa Infrastructure Fund provides long-term foreign currency debt finance for infrastructure projects in sub-Saharan Africa.
In March, the fund provided $15 million of senior debt and $14 million of subordinated debt to Safal Group, a metal roofing manufacturer with operations in Kenya and Tanzania.
In December 2007, publicly listed alternative asset manager The Blackstone Group struck a deal through its portfolio company Sithe Global to construct an $870 million hydro electric powerstation in Uganda.