UK Prime Minister Boris Johnson has announced that British International Investment (BII) is to invest up to £160 million into a joint venture between Norfund and Scatec that will help develop Africa’s hydropower sector, with Norfund committing a further US$100 million.

“It’s great to announce that BII is putting 160 million pounds into hydropower in Africa, creating 180,000 jobs,” said Prime Minister Boris Johnson when announcing the deal at the Commonwealth Business Forum in Rwanda. “I see a fantastic future for all of us in these initiatives. We want to be the partner of choice for our African friends as you transform millions of lives.”

Last year Norfund sold hydropower developer SN Power to Scatec, with part of the deal being that Norfund retained 49% ownership in the company’s portfolio in Africa as a joint venture. Now BII, the UK development finance institution, is joining the partnership.

Norfund has been developing hydropower since the fund’s inception. This will however be the largest investment in hydropower in BII’s 74-year history, with up to $200m of capital committed over the next several years. Norfund is seeding the partnership with their existing share in their joint venture with Scatec and further capital commitments of up to $100m over the next several years. 

The investment extends and compliments BII’s and Norfund’s existing commitments and partnerships to powering Africa, through Globeleq, a 2.3GW IPP company in which BII and Norfund are shareholders, and the joint investment the two development finance institutions have in H1 Capital – a South-African black-owned and managed renewables investment and development company.

Norfund and BII now together hold a 49% stake in Scatec’s African hydropower portfolio, which includes a mixture of operating assets as well as a number of assets under development, including the proposed 205MW Ruzizi III hydropower plant, which will provide power to Rwanda, Burundi and DRC, the 120MW Volobe hydropower plant in Madagascar and the 350MW Mpatamanga project in Malawi among others.