Ouagadougou, Burkina Faso, June 16, 2022— To boost access to cleaner and more reliable energy in Burkina Faso, including for rural households, IFC today announced a local currency financing package for Sodigaz, one of Burkina Faso's leading energy companies.
IFC's support will help Sodigaz increase the distribution of liquified petroleum gas (LPG) to underserved rural households across Burkina Faso and bring solar energy to a 1,000-unit affordable housing project near the capital, Ouagadougou, contributing to better health outcomes and supporting the country's transition to cleaner energy.
The €12.4 million financing package consists of a local currency loan up to the equivalent of €8.4 million in CFA francs from IFC's own account and a parallel loan equivalent to €4 million in CFA francs mobilized from a partner commercial bank. The investment will support the expansion of Sodigaz's LPG distribution infrastructure in rural and urban areas and the construction of a 1.54 MWp (megawatt-peak) solar plant.
In Burkina Faso, only about 20% of the population is connected to the grid (around 65 percent in urban areas and less than 5 percent in rural areas), limiting social and economic development, with much of the population of 21 million reliant on wood and charcoal for cooking. Increasing access to gas and solar will provide householders with cleaner, healthier, more reliable sources of energy.
"IFC's support will help strengthen Sodigaz's capabilities, bring to fruition structuring projects, enhance its operational efficiency, and develop households' access to clean cooking and solar energy solutions in Burkina Faso," said Lala Bolly, Chief Executive Officer of Sodigaz.
"Improving access to clean energy solutions for better economic and health outcomes is a priority for IFC in Burkina Faso," said Olivier Buyoya, IFC's Country Manager for Burkina Faso. "IFC is proud to support a local champion's ambition to support cleaner energy supply in Burkina Faso through investment in renewable energies and accelerating the switch to cleaner LPG from solid fuels."
IFC's investment is supported by the International Development Association (IDA) Private Sector Window (PSW) Local Currency Facility (LCF), through guarantees and cross-currency swaps. The IDA PSW LCF helped provide long-term financing in CFA francs that would not otherwise be readily available in the local market.
The financing announced today builds on an agreement between IFC and Sodigaz signed in September 2021 when IFC began providing advisory support to Sodigaz in three key areas: the development of distribution models and value chains for clean energy solutions; improvement of efficiency of operations; and financial management.
For the next three years, IFC aims to increase its investments in the Sahel, including mobilization, in key sectors for growth and social progress, such as infrastructure, green energy, agribusiness and value chain development, and financial inclusion.
About IFC
IFC—a member of the World Bank Group—is the largest global development institution focused on the private sector in emerging markets. We work in more than 100 countries, using our capital, expertise, and influence to create markets and opportunities in developing countries. In fiscal year 2021, IFC committed a record $31.5 billion to private companies and financial institutions in developing countries, leveraging the power of the private sector to end extreme poverty and boost shared prosperity as economies grapple with the impacts of the COVID-19 pandemic. For more information, visit www.ifc.org.
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About Sodigaz
Created in 1977, Sodigaz is currently the leader in gas in Burkina Faso. With a network of several thousand sales outlets throughout the country. Sodigaz has become the driving force behind the popularization of butane gas use by the population and economic players, thus helping to reduce the consumption of wood fuel, fight deforestation and promote the development of income-generating activities. In addition to its positioning in LPG distribution, Sodigaz has also diversified into solar energy in order to increase access to electricity and more strongly support the sustainable development dynamic in Burkina Faso. Finally, SODIGAZ has initiated a process of expansion in Africa, with a first concrete establishment in Benin through the new subsidiary Progaz. For more information, you can contact us by e-mail (noraogo.sawadogo@sodigaz.com) or consult the following links.
Website: http://www.sodigaz.com/
LinkedIn: SODIGAZ APC
Twitter: Sodigaz officiel
