THE World Bank has approved a M740 million facility to fund the improvement of Lesotho’s energy supply.
The funding is made up of a M560 million (US$40 million) loan from the International Development Association (IDA) and M180 million (US$12.9 million) from the Scaling Up Renewable Energy Program (SREP) of the World Bank. Another US$8 from SREP is also a loan while the rest is a grant.
According to the World Bank, the funding is aimed at expanding access to electricity and will target people living in remote areas among other groups. It will also upgrade power generation.
“It (the funding) will support upgrading of the Lesotho Electricity Corporation (LEC)’s hydro-based mini-grid in the remote village of Semonkong to provide additional connections to both household and commercial customers, as well as metering solutions for new and existing customers,” the World Bank said in a statement.
The statement also said the funding will support grid extensions to commercial and industrial consumers located in the economic zones of Lesotho.
“The project will also facilitate the electrification of areas where supply through mini-grids would be the least-cost option. In particular, the project will strengthen the legal and regulatory framework for the deployment of mini-grids and will help finance the construction of mini-grid infrastructure to provide electricity services to new users in up to 40 communities.”
World Bank country director for Lesotho, Botswana, eSwatini, Namibia and South Africa, Marie-Francoise Marie-Nelly, said the funding would help the country improve universal access of sustainable energy.
Only 40 percent of the country is estimated to have electricity connection.
“Through this project, the World Bank will assist Lesotho towards achieving its goal of providing universal access and affordable energy in a sustainable manner, while helping improve the lives of Basotho particularly in the hard-to-reach rural areas and peri-urban areas.
“This is in line with the Lesotho National Strategic Development Plan (NSDP) and the World Bank Group’s twin goals of reducing extreme poverty and promoting shared prosperity”.
While the World Bank did not specify the actual number of consumers to benefit from the funding, it said a few thousands will have improved access to reliable and affordable electricity.
“The Lesotho Renewable Energy and Energy Access Project, which is largely targeted at people living in remote areas, aims to expand access to electricity to diverse consumers with varied needs, including households, rural communities and in the outskirts of urban areas, small and medium enterprises and economic centres that are on or off the grid.”
The World Bank said the project would also provide technical assistance to build capacity of both public and private sectors to ensure sustainable provision of electricity in Lesotho. This project will give an impetus to Lesotho in its achievements of Sustainable Development Goals 7 — Affordable and clean energy.
“The project will create the conditions for more effective service delivery in remote areas and will contribute to creating an enabling environment for economic activity that will foster job creation for the youth through the participation of the private sector in the delivery of on and off the grid energy,” the World Bank said.