Request for Information: Off-grid Clean Energy Solutions for Benin

 

Introduction The Government of the United States, through the Millennium Challenge Corporation (MCC), is developing a $300 million compact with the Government of Benin (GOB) focused on Benin’s electrical power sector. The compact is expected to be signed in August 2015. In order to inform the preparation of the compact, MCC and its partner GOB agency, the Unité de Coordination de la Formulation du 2eme Programme et Suivi des Reformes de MCA-Benin (UCF) invite interested companies and organizations from around the world to submit information regarding potential projects that would expand access to renewable off-grid electrical power in Benin. MCC and UCF will use the information to determine whether to design a matching grant facility to provide matching funding to a project sponsor towards the overall cost of a clean energy project in Benin. Final project selection decisions would be determined at a later date through a separate competitive grant application process to be launched following the signing of a proposed MCC compact with Benin. Signing of the compact is subject to successful negotiation by the GoB and MCC, as well as MCC Board approval of a compact. The Challenge Only one-third of Benin’s population of ten million has access to electrical power, with extraordinary spatial disparities - over half of urban residents have access to electricity, while only 4.5% of rural inhabitants do. Electricity consumption in Benin is below average for Africa’s low-income countries at 110 kWh/capita per year – equivalent to only 0.01% of the average for middle-income economies. In addition to limited access, there are delays in connecting new customers and the front-end cost for connection is high relative to average annual income. Benin’s electrical power network is characterized by high technical and commercial losses in the distribution network totaling 22%, extensive outages in distribution (planned outages, rationing and unscheduled cuts), and poor quality service Benin relies on most of its electricity from a company jointly owned by the Governments of Benin and Togo, the Communauté Electrique du Benin (CEB), which is responsible for power generation and transmission. CEB in turn supplies power to Benin’s national distribution company, the Société Béninoise d’Energie Electrique (SBEE). As CEB’s own production capacity is limited, the company has depended on imports of electricity from neighboring countries such as Ghana and Nigeria, which have not been a reliable source of supply due to growing demand in the region. Demand is also growing rapidly in Benin, having doubled in the past decade and is forecasted to double again in the next five years, only accounting for on-grid consumers. Given supply shortages to meet this growing demand, SBEE meets some of its own electricity needs using hydropower and diesel generation to supplement supply from CEB. These sources, however, have proven far from sufficient. In 2012, 99% of Benin’s on-grid electric energy supply of 1,065.4 GWh was imported (primarily from Nigeria), while only one percent (8.34 GWh) was provided through SBEE’s own thermal and hydroelectric generation assets. In addition to CEB and SBEE, there are two other major organizations in the energy sector within the Government of Benin, both of which reside in the Ministere de l’Energie, des Recherches Petrolieres et Minieres de l’Eau et du Développment des Energies Renouvelable (MERPMEDER). These include the newly-established Agence Nationale des Energies Renouvelables (ANADER) and Agence Beninoise de l’Energie Renouvelable et de la Maitrise de l’Energie (ABERME). Having only been established in June 2014, ANADER is still a new organization, but the intent of the Government of Benin is for it to ultimately be responsible for all projects related to clean energy and off-grid electrification. ABERME is the entity responsible for rural electrification and has previously implemented energy efficiency and clean energy projects, though in the future its responsibilities will likely center around on-grid rural electrification. Due to growing concerns with energy shortfalls the Government of Benin is pursuing new domestic sources of generation, both to service on- and off-grid customers. The MCC Benin compact will assist Benin in the development of both on and off-grid solutions to meet the country’s power shortfalls. The solution MCC and UCF are interested in potential project information and concepts to address one of the following potential focus areas: 1. Critical public infrastructure such as water treatment and pumping facilities, hospitals, health clinics, courts, universities, schools, and ports. The focus of these projects would be to install relevant equipment/systems along with an administrative framework for operations, maintenance, and replacement of the equipment/systems with the concerned organization. Examples could include solar PV systems with storage, biomass generation units, mini-hydro plants, etc. 2. Community and commune-level electricity generation and distribution to provide relevant equipment/systems along with an administrative framework for a mini-grid, including billing, operations, maintenance, and replacement of the equipment/systems with the concerned communities or communes. Examples could include solar PV systems with storage, biomass generation units, mini-hydro plants, etc. along with relevant distribution infrastructure. While MCC and UCF will not provide funding for productive uses of electrical power (e.g. drip irrigation, refrigerated storage, or other agricultural processing equipment), project sponsors may count resources dedicated towards those purposes towards the matching fund requirement. 3. Household-level generation and storage. Household-level systems such as pay as you go solar PV kits have expanded dramatically in recent years in many countries. The focus of these projects would be to create viable businesses in Benin that import, install and repair household level PV and other technologies available on the marketplace. Cellular penetration in Benin is very high and mobile banking is growing very rapidly, providing opportunities for entrepreneurs entering the market with lease to own, pay as you go, franchising or other business models. 4. Energy efficiency measures. Energy efficient appliances and equipment reduce lifecycle costs for electricity customers and reduce demands on the grid. The focus of this project would be to develop and deploy business models for the deployment of energy efficient appliances and other equipment for government, household, and commercial users. Nature and range of possible funding If the facility is included in a potential compact, it is expected that awards thereunder will be in the form of a matching cash grant to a project sponsor for the purpose of sharing in half the total cost of the project. It is further expected that the project sponsor will provide at least half (50%) of the total project cost in cash or through in-kind services. For projects sponsored by not-for-profit organizations, faith-based organizations, academic institutions, rural communities and communes, the cost sharing will be at least 35% of the total capital cost of the project from the sponsor and 65% of the total capital cost of the project from the facility. Although the range of any grant under a proposed grant facility would be determined at a later date, it is currently contemplated that grant awards could range in size from $100,000 to $5 million, though the final range will be determined based in part on information received as part of this Call for Ideas. Who may submit information The project sponsor submitting information may be from any category of organizations or institutions, US or non-US, with operations or intent to establish operations in Benin. Specific categories of organizations, institutions, and entrepreneurs that are welcome to respond include but are not limited to: educational, industrial, not-for-profit and for-profit organizations, faith-based organizations, academic institutions, civic groups, regional organizations, international organizations, bilateral or multilateral donors, public agency or enterprise of the Government of Benin, vendors, start-ups, and project developers. Interested parties may submit information for more than one project/concept/idea. Information requested Information requested in this announcement should total no more than five pages and address the following: • A brief description of the proposed project, including the objective, nature of the proposed activities (e.g., technical assistance, capital works design and construction, operations and maintenance) • Anticipated benefits and costs (may use data from similar countries if Benin-specific data is unavailable) • Number and description of beneficiaries, if known • Geographic location, if known • Local partner organizations, if applicable • Description of approach to sustainability, such as summary of business plan or organizational model for recuperating costs and performing operations, maintenance and replacement of equipment. A business plan should describe o The approach to collecting revenue, marketing, and other aspects of business operations o The approach for ensuring an organization has the technical and resource capacity to conduct or procure operations, maintenance and replacement of the equipment o How the project can over the long term be replicated at scale and how grants may be phased out over time o Where applicable, how costs may be decreased with innovation, future improvements in technology or economies of scale and how revenues may increase over time with improvements in project output or productivity • Description of technologies to be employed such as: o Solar photovoltaic systems with or without smart grid or thermal or concentrated solar technologies o Biomass/biogas from organic waste or vegetative materials o Hydropower including run of river systems and storage or pumped storage o Wind power systems o Hybrid or other non-fossil fuel power generation technologies The information may be provided in English or French. Deadline Organizations should provide the information requested by March 6, 2015 to benin@mcc.gov. Use of information by MCC/UCF MCC and UCF will use the information received under this request to inform final decisions regarding the inclusion of a matching grant facility in the proposed Benin compact, including scope, budget, implementation methodologies, and timeline. If the compact includes the matching grant facility, is approved by MCC’s Board of Directors and is signed by both governments, project sponsors may be contacted to provide additional information through a separate request for proposals at a later date. The information received by MCC and UCF will be kept in strict confidentiality and will not be shared with external parties. This notice does not obligate the Government to award an agreement or otherwise pay for the information provided in response. The Government reserves the right to use information provided by respondents for any purpose deemed necessary and legally appropriate. Respondents are advised that the Government is under no obligation to acknowledge receipt of the information received or provide feedback to respondents with respect to any information submitted. If a request for applications is issued at a later date, responses to this notice will not be considered adequate responses to a request for applications. For additional information MCC/UCF will offer information sessions to interested organizations at the following events: February 10: Corporate Council on Africa, Washington, D.C. February 13: Cotonou, Benin February 19: Casablanca, Morocco February 26: Chambre de Commerce et d’Industrie de Paris, France February 28: Paris, Novotel Les Halles, France Interested organizations may also contact benin@mcc.gov for additional information.

Deleted 04/05/2015 (Archived.) MCC-15-RFI-0001 Agency: Millennium Challenge Corporation Other 03/06/2015 This program does not have cost sharing or matching requirements. Jennifer Crouse
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