A credit of US$20 million for Yemen to finance a wind park project at Mocha on Yemen’sRed Sea coast has been approved by the World Bank’sBoard of Executive Directors.
The project consists of the development and construction of a 60 megawatt wind power farm, which will increase the supply of cost-effective electricity from renewable sources for Yemen.
Other contributions to the project include: A credit of US$65 million from the Arab Fund for Social and Economic Development; of $20 million from the OPEC Fund for International Development; and a grant of US$20 million from the Saudi Fund for Development.
The activities to be financed by the grant include the construction of the wind power farm and consulting services and capacity building to support project and program development through private-public partnership.
“We are pleased to support Yemen’s first wind power project together with other donors, which will increase the cost-effective electricity supply essential for poverty reduction, job creation, and economic development,” said Wael Zakout, Country Manager for Yemen.
“Increased power supply is critical to Yemen, a country undergoing political and economic transformation towards more equitable growth.” The implementation of Mocha Wind Park Project will help Yemen meet its increasing electricity needs with environmentally friendly, renewable energy with the potential of reducing Yemen’s dependence on fossil fuels. Compared to the liquid fuel generation that currently dominates the Yemeni power system, the generation of this lower-cost, wind-powered electricity will contribute toward improving the sector’s financial position and reducing the need for energy subsidies.
This is the first wind power project to be developed and implemented in Yemen and as such its success will have a huge impact on the future of the wind power industry in the country. The project will address a number of institutional, regulatory, financial, and technical barriers in the energy sector, helping lay a solid foundation for Yemen to scale up wind power either through private financing or public-private partnership.
The grant is part of the Bank’s program in the energy sector, which also includes the development of a strategy for key segments of the sector. The implementation of the strategy will put the sector on a path to sustainable development supporting Yemen’s goals of reducing poverty and promoting shared prosperity.