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Benin Power Compact

Per capita consumption of electricity in Benin is among the world’s lowest because of limited access to and availability of electricity for the country’s 11.8 million people. Rapidly growing demand coupled with inadequate maintenance and insufficient investment have stressed Benin’s national grid, resulting in poor service that impacts households, hurts businesses, and hinders public services.

MCC is partnering with Benin to tackle these issues through a $391 million compact that is reforming and modernizing the West African country’s power sector. With an additional contribution of $28 million by the Government of Benin, the compact aims to strengthen the national power utility, attract private sector investment into solar power generation, and fund infrastructure investments in electricity distribution as well as off-grid electrification for poor and unserved households.

  • Original Amount at Compact Signing:
    $391000000
  • Amount spent:
    $389199872
  • Entry Into Force:
    June 22, 2017
  • Signed:
    September 9, 2015
  • Closed:
    June 22, 2023

Project Results

Electricity Distribution Project

  • $284,550,747
    Original Compact Project Amount

Estimated Benefits

Estimated Benefits for the Electricity Distribution Project
Time Estimated Economic Rate of Return (ERR) over 20 years Estimated beneficiaries over 20 years Estimated net benefits over 20 years
Not specified 10,600,000 $634,000,000

Project Description

MCC is modernizing Benin’s electricity distribution infrastructure to expand grid capacity, accommodate future demand growth, improve service reliability, reduce losses, and minimize outages. The project focuses on improving the power grid serving Cotonou—Benin’s center of commerce and government—as well as areas in northern Benin with high levels of poverty. At a national level the project is building a modern dispatch and control center to manage Benin’s grid more effectively.

Electricity Generation Project

  • $10,828,693
    Original Compact Project Amount

Estimated Benefits

Estimated Benefits for the Electricity Generation Project
Time Estimated Economic Rate of Return (ERR) over 20 years Estimated beneficiaries over 20 years Estimated net benefits over 20 years
Not specified 10,600,000 $634,000,000

Project Description

To accomplish the project objectives, MCC funding will be used to increase Benin’s domestic generation capacity by up to 50 megawatts (AC) of solar photovoltaic generation through an independent power producer (IPP) transaction.

Off-Grid Electricity Access Project

  • $29,743,327
    Original Compact Project Amount

Estimated Benefits

Estimated Benefits for the Off-Grid Electricity Access Project
Time Estimated Economic Rate of Return (ERR) over 20 years Estimated beneficiaries over 20 years Estimated net benefits over 20 years
Not specified 135,000 $23,740,000
Not specified 329,000 $14,400,000
Not specified 89,000 $38,300,000

Project Description

This project is helping to address the gap in access to electricity for two-thirds of Benin’s population through policy reforms, infrastructure financing, and public-private partnerships, including:

  • Benin’s first-ever policy, strategy, master plan, and regulatory framework for off-grid electrification; and
  • Off-grid electrification systems for communities, households, and micro-businesses through a competitive grant facility that is leveraging private investment.

Policy Reform and Institutional Strengthening Project

  • $24,731,551
    Original Compact Project Amount

Estimated Benefits

Estimated Benefits for the Policy Reform and Institutional Strengthening Project
Time Estimated Economic Rate of Return (ERR) over 20 years Estimated beneficiaries over 20 years Estimated net benefits over 20 years
Not specified 10,600,000 $634,000,000

Project Description

MCC funding is:

  • Improving governance in the electricity sector by strengthening regulation, supporting tariff reforms, advancing energy efficiency, and creating a policy and institutional framework for independent power producers;
  • Improving the national electricity utility’s management, operations, and maintenance through a management contract; and
  • Informing and educating the public on tariffs, energy efficiency, renewable electricity, and other key electricity sector issues.

As of Fri Jul 28 2023 00:00:00 GMT-0400 (Eastern Daylight Time)