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Afghanistan: The Ministry of Energy and Water (“Procuring Authority”) has launched a request for qualification (“RFQ”) for a 40 MW solar photovoltaic energy project in the Herat region ("Project")

  • United Kingdom
  • Energy and infrastructure - Clean energy

24-10-2019

Background

The Procuring Authority has engaged the International Finance Corporation, acting through its Public Private Partnerships Transaction Advisory Services division, to act as lead transaction advisor in relation to the Project. The RFQ will be launched as part of the scaling solar program, a World Bank initiative that aims to create a viable market for solar power in each client country (“Scaling Solar”). The Project will be constructed on a Public Private Partnership basis, based on the model risk allocation, documentation and methodology developed under the Scaling Solar initiative. Consequently, the Procuring Authority is seeking private sector developers or consortia to develop, finance, construct, own, operate, maintain and transfer the Project on a site identified by the Procuring Authority in Herat province.

At present, approximately 70% of Afghanistan’s total power capacity of 1,450 MW is imported from Tajikistan, Turkmenistan, Uzbekistan and Iran. Access to electricity remains low at around 34 percent, focused in urban areas and along transmission corridors that are connected to imported energy.

Project and Timetable

The timetable for the project will be as follows:

Stage

Date

Request for Qualification issuance date

19 October 2019

Feedback deadline on i) project scope ii) risk allocation iii) credit enhancement, and iv) financing strategy

15 November 2019

Clarification request deadline

23 November 2019

Prequalification Application Submission

30 November 2019

Announcement of Prequalified Bidders

14 December 2019

Government approval* and RFP issuance / Data Room launched

28 December 2019

 

*subject to MEW/MoE approval of transaction structure

The developers will implement the Project through a special purpose vehicle (“SPV”) incorporated specifically for this purpose and will enter into a PPA with Da Afghanistan Breshna Sherkat (“Purchaser”), under which the SPV will, subject to a set of operational performance standards set out in the PPA, sell to the Purchaser all of the electrical energy generated by the Project.

In addition, subject to approval of the relevant government authorities, the SPV will enter into a government support agreement with the Government of Islamic Republic of Afghanistan, acting through the Ministry of Finance, under which the Government will undertake to provide certain protections and other support to the Project.

If you would like to discuss clean energy opportunities in Afghanistan, the above or the market generally, please contact the team below.

 

For more information contact

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