Project Finance: Practical Case Studies

(Frankie) #1

  • an independent operator that initially has responsibility for new public works in the elec-
    tricity sector but eventually is slated to be in charge of buying, selling and transmitting
    all electricity in the network; and

  • an autonomous regulatory body in charge of existing concessions, dispute resolution and
    protection of consumer interests.^5


Current situation


Over the past decade electricity demand in Côte d’Ivoire has been increasing at an annu-
al rate of about 12 per cent. The Azito power plant addresses a power supply shortage in
Côte d’Ivoire and allows power exports to neighbouring countries such as Ghana, Togo,
Benin and Burkina Faso. Before 1994 Côte d’Ivoire was a net importer of electricity from
Ghana. The project also reduces the country’s reliance on hydroelectric power in the event
of a drought. Whether a given country in the region is an importer or exporter of electric-
ity is partly determined by the amount of its rainfall and resulting hydroelectric power
generation.^6
Côte d’Ivoire’s power grid supplies more than 500,000 customers, about two thirds
being in urban areas. While the country’s power infrastructure compares favourably with
those of its neighbours, only 25 per cent of the population has access to electricity and many
rural communities are not linked to the national grid. Growth of the transmission and distri-
bution network has lagged behind increases in generation capacity in recent years, and there
are substantial transmission losses from theft and electromechanical deficiencies.
Nonetheless, quality and reliability improved substantially over the 1990s, with a decrease
in the average outage time per year from 50 hours in 1990 to 12 hours in 1998. Tariffs are
the responsibility of the Council of Ministers. They have fallen significantly in real terms
over the past decade.^7


Project description


The Azito BOOT project consists of the installation of two 144 MW generators and the con-
struction of a transmission line from the plant site to the Côte d’Ivoire national grid. The plant
is located in the Youpougon industrial zone in the village of Azito, 10 kilometres from the
capital city, Abidjan. It was constructed in two 144 MW phases, the first being completed in
January 1999 and the second in January 2000.


Project sponsor


The project sponsor is Cinergy, a company owned by ABB Energy Ventures, a subsidiary of
the ABB Group; Industrial Promotion Services, the local arm of the Aga Khan Fund for
Economic Development; and Éléctricité de France Internationale.
The ABB Group operates worldwide in power generation, transmission and distribution;
automation; oil, gas and petrochemicals; industrial products and contracting; financial ser-
vices; and rail transport.
EDF joined the partnership at a late stage of concession negotiations. It was expected to
benefit the project through its prior experience in Côte d’Ivoire, including ownership interest
and participation in the management of CIE and CIPREL.


POWER PLANT

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