Private Infrastructure Development Group (PIDG)
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Private Infrastructure Development Group (PIDG)
A consortium of nine donor organisations who have joined together to help facilitate PSI in infrastructure in developing countries, with a principle focus on SSA Countries
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Current Members of PIDG
Austria Switzerland
Australia The Netherlands
Germany United Kingdom
Ireland World Bank Group
Sweden (through the IFC)
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Investment in New Infrastructure in Africa
65%Governments
20%PSI
15%ODA
• Current investment totals c US$24 billion per year.
• WB/AfDB estimate that this needs to be more than doubled if even basic needs are to be met within the coming decade.
Distribution of Current Investment
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Constraints to PSI
Lack of an appropriate enabling environment
Shortage of long-term FX debt
Shortage of local debt
Limited local capacity
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What PIDG and its Partners are doing to help
• PPIAF (a PIDG partner) - helps improve the enabling environment
• InfraCo Africa – develops projects for the market• EAIF – provides long-term hard currency debt to
bridge financing gaps• GuarantCo – provides local currency guarantees
to local debt providers• TAF – helps build local implementing capacity
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InfraCo Africa
February 2011
Creating viable infrastructure investments across Sub-Saharan Africa
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Lack of resourcesLack of technical expertise
Lack of funds
Africa faces a Capacity Gap
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Developing Countries:
• In developed countries governments have the capacity and funds to develop PPP projects “in-house” and attract private sector investors
• Developing country governments face a capacity gap:
Capacity Gap
Project/PPP Development Cycle has Three Main Components
Conceptualize Develop Build & Operate
Developed Countries:
InfraCo was created to bridge the Capacity Gap
Government’s Role
Government’s Role
Private Sector’s Role
Private Sector’s Role
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InfraCo and Procurement
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• As a publicly funded entity, InfraCo must ensure value for money and transparency in all its procurement activities
• InfraCo follows PIDG (European Union) procurement regulations:• All contracts are procured competitively and assessed
transparently
• Major contracts (e.g. EPC, O&M) are advertised widely in the business press and the European Journal
• Consultancy work is procured through competitive bidding, or if there is only one qualified bidder, value-for-money benchmarking is used
• InfraCo selects equity investors through a competitive bidding process and uses competition to ensure costs of debt are kept low
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Governments across Africa are Partnering with InfraCo
Cape Verde: 26MW Wind Farm Project
Ghana: 340MW Gas Turbine Power Plant
Guinea: Mini-hydro Project
Senegal: Wind Power
Zambia: Agricultural Irrigation
Zambia: Hydro Power Project
Kenya:Nairobi Rail
eleQtra Offices
Senegal: River Transport
Mozambique: Bio-ethanol
Uganda:Multi-sector, road & water transport, water, power
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Some InfraCo ProjectsCenpower, Ghana:• 340 MW Combined-Cycle Gas Turbine power
plant near Tema
• Approx. project cost $400m
• InfraCo has led development in partnership with local private developer
• Site, Permits and Generation license secure
• InfraCo secured PPA with ECG, has managed EPC procurement
• Equity investment secured from Africa Finance Corporation
• Competitive EPC procurement ongoing with bids received from multiple bidders
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Some InfraCo ProjectsBugala Island, Lake Victoria, Uganda:• Two New Ferries plus two landings:
– Design and Build contract with Johs. Gram-Hanssen A/S of Denmark and local Lake Victoria shipyard
– Ferries $3.5m each / 120t carrying capacity / 60 vehicles 120 passengers / 10 knots
– Training of Ferry Crew
– Full cost recovery vehicle tariffs
• 65 km road / 1.6 MW solar-diesel power plant / distribution network on island / water supply
• Total project cost $40m
• Financing through GuarantCo (tenor extension), USAID (60% guarantee), Finnfund, Nedbank
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Some InfraCo Projects
Chiansi Irrigation, Zambia:• $30m investment in irrigation infrastructure
• Water rights secured to extract from Kafue river
• Project will lease 2,300 ha of smallholder and commercial farm land for 25 years
• Landowners participate in project equity and receive share of cash flows from farming activities
• Smallholder farmers receive access to market garden irrigated plots
• Pilot project established in 2009 is producing wheat and soya on 150 ha of smallholder land
• Capital financing from ORIO, FMO, Lundin for Africa, EAIF and commercial investors
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Some InfraCo ProjectsRiver Transport, Senegal:• Up to $700m River Transport project for iron
ore, phosphate and general cargo transport on the Senegal River including transfer to Panamax dry bulk ship in new port in St. Louis
• Senegal River Development Authority - OMVS - (advised by the Port of Rotterdam) have signed MoU with InfraCo to develop project as a PPP
• The Project is currently in the Evaluation stage
Nairobi Commuter Rail, Kenya:• JDA signed with Kenya Rail, currently in
feasibility stage • $200m refurbishment and extension of
commuter rail system in Nairobi• Permission from Kenyan Public Utility
Oversight Authority to do a negotiated contract on the basis that “the services offered by InfraCo are unique”
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Some InfraCo ProjectsCape Verde Wind Farm:• 26 MW power plant, total project cost
€65m
• Will provide 25% of national power needs replacing expensive fossil fuel generation
• InfraCo began development in partnership with Electra and GoCV in 2006
• InfraCo secured site, permits, PPA, government guarantee and finance and managed procurement
• Vestas selected as EPC contractor following competitive process
• Financing secured from AFC, Finnfund, AfDB and EIB
• Construction started in November 2010 and will be completed by late 2011
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6MW
8MW
4MW
8MW
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Cape Verde – Case Study – Awarded Contracts
Cape Verde Awarded Contracts:• Owners Engineer - €300,000
• Wind Assessment - €40,000
• Environmental Consultant - €230,000
• Lenders Engineer - €130,000
• Financial Advisor Contract - €700,000
• Owners Legal Counsel - €1,500,000
• Lenders Legal Counsel - €1,100,000
• Wind Farm EPC contract - €45m
• Wind Farm Maintenance Contract - €500k / yr
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6MW
8MW
4MW
8MW