The Maldivian government has finalized a financing agreement with the Asian Development Bank (ADB) amounting to USD 50.5 million, with the aim of bolstering renewable power generation and upgrading the grid infrastructure across the South Asian archipelago.
The funding package comprises USD 41.5 million in grant financing from the Asian Development Fund, accompanied by a concessional loan of USD 8.5 million from ADB's ordinary capital. An additional USD 500,000 in grant financing from the Climate Fund is also part of the agreement, according to the announcement made by ADB on Wednesday.
The allocated funds will be utilized for the installation of grid-scale energy storage facilities and solar photovoltaic (PV) plants, along with the implementation of energy management facilities. The comprehensive plan also outlines distribution grid upgrades in 20 outer islands, as well as the deployment of ocean-bound floating solar panels, wave power plants, small wind turbines, and flow batteries.
In a collaborative effort, an additional USD 48 million in co-financing has been secured from the Asia-Pacific Climate Finance Fund, Clean Technology Fund, Japan Fund for the Joint Crediting Mechanism (JFJCM), and contributions from the private sector. The government of Maldives will further extend USD 1.97 million in counterpart financing.
This strategic financing aligns with the Maldives' commitment, made in December of the previous year, to achieve a substantial increase in renewable energy capacity. The ambitious goal aims to enable the country to derive 33% of its power from renewable sources within the next five years.
The financial support from ADB and its partners is expected to play a pivotal role in advancing the Maldives' renewable energy objectives and fortifying its energy infrastructure, contributing to the nation's sustainable development efforts.