DFC Extends Funding Support To Madagascar’s Volobe Hydro Power Plant Development

The U.S. International Development Finance Corporation (DFC) has approved technical assistance funding to support the development of the pioneering 120 MW hydropower project in Madagascar.

The announcement was made on the sidelines of Africa50’s General Shareholders Meeting (GSM) in Antananarivo.

The new technical assistance facility is a significant milestone that underscores the strategic cooperation between DFC and Africa50 and a shared commitment to scale innovative and climate-resilient infrastructure across the continent. The project company will deploy the funding into expediting project development activities, accelerating the project’s path to financial close.

Volobe, the 120 MW run-of-the-river hydroelectric power plant, will boost the supply of stable and affordable power to millions of people in Tamatave and the capital city, Antananarivo through a transmission line under construction of c. 270 KM. The Volobe project will increase the country’s electricity generation capacity by approximately 20 per cent, bringing clean energy, jobs, and productivity gains to Malagasy businesses and individuals across the country.

The project is managed by the Compagnie Générale Hydroélectrique de Volobe (CGHV) which has Axian and Africa50 as shareholders.

Once operational, the hydropower plant is expected to generate substantial cost savings for JIRAMA (the Malagasy state-owned utility company) and will significantly contribute to Madagascar’s climate agenda.

Volobe will be located on the Ivondro River, approximately 30 kilometres from the eastern city of Toamasina, the second largest city in Madagascar.

The project harnesses Madagascar’s extensive hydroelectric potential, estimated at approximately 7.8 GW. Over 800 hydropower sites with high untapped potential have been identified across the country.

DFC Deputy Vice President of the Office of Development Policy, Christopher Walker, said: “DFC is proud to support Africa50 in their efforts to advance the development of the 120 MW run-of-the-river hydroelectric power plant which will positively impact many of Madagascar’s citizens for generations to come. 

Expanding access to electricity has long been a priority for DFC and our partners. Investments in energy provide people and businesses with reliable and secure sources of electricity to drive development, promote economic growth, and advance job creation.”

Remy Huber, CEO, CGHV, said: “The Volobe project is advancing with all stakeholders and sponsors working towards completion.

This determination is reflected in the agreement with DFC, which marks a crucial step towards financial closure, expected in 2025. Thanks to its multifaceted nature, the Volobe project balances sustainability with inclusive economic growth, meeting the expectations and needs of both local communities and industries”.

Anas Charafi, Senior Investment Director, Africa50, said: “This technical assistance funding by DFC is testament to the strength and strategic importance of the Volobe project which we are jointly developing with Axian. It will help expedite the development of the project, which will support industrialization and play a key role in decarbonizing the energy sector. Africa50 mobilizes local and global capital at scale and, working hand in hand with our strategic partners, we aim to fast track the execution of transformative infrastructure projects”.