Kipay Investments is tasked with developing, designing, constructing, installing, commissioning, operating and managing the hydroelectric power plant. Credit: DedMityay/Shutterstock.

Afreximbank (the African Export-Import Bank) has signed a financing agreement for a renewable energy project in the Democratic Republic of Congo (DRC) – a significant step in expanding green infrastructure in Central Africa.

The project, to be developed in partnership with Kipay Investments, includes the development of a reservoir-based hydropower plant with 200MW capacity along the Lufira River.

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The agreement will see Afreximbank finance the technical and bankability studies, legal and financial advisory, and fundraising costs. The bank will also lead the structuring of the project’s debt financing.

Kipay Investments is tasked with developing, designing, constructing, installing, commissioning, operating and managing the hydroelectric power plant.

The initiative aligns with the bank’s climate finance strategy and represents its first private-sector renewable energy project in the DRC.

The hydropower project aims to provide clean, reliable and affordable power to mining companies, supporting the beneficiation [the treatment of raw materials to improve their physical or chemical properties] of critical minerals such as copper and cobalt.

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It will also expand electricity access to nearby communities, enhancing education and healthcare facilities.

The project is expected to reduce greenhouse gas emissions by 108,000Mt of CO₂-equivalent annually, contributing to the DRC’s climate targets under the 2015 Paris Agreement.

Afreximbank intra-African trade and export development executive vice-president Kanayo Awani stated: “This signing ceremony underscores Afreximbank’s commitment to support renewable energy projects that spur industrialisation and export development activities while promoting a just energy transition.

“Afreximbank is committed to supporting DRC’s energy transition, enhancing the country’s energy security whilst leveraging its vast renewable energy potential to develop sustainable trade-enabling energy infrastructure.”

“This financing reinforces Afreximbank’s commitment to mobilising private capital to develop renewable energy projects and secure a sustainable future for DRC and the region. We are also proud to highlight the innovative structure deployed that encompasses a captive market that enhances the project’s bankability.”

The project will create 2,000 direct jobs and 952 potential indirect jobs, while boosting fishing and other economic activities on the reservoir.

It will also generate tax revenues for the DRC government over its 30-year duration, and foster industrial clusters around the mining area.