Botswana Renewable Energy Support Project – Project Appraisal Report
Botswana’s current installed capacity of 890MW, is dominated by coal resources (99%) and the country is in the process of rebalancing the power mix by involving the private sector in building additional capacity in renewable energy sources. To this end, the country’s first Integrated Resource Plan (IRP), which was approved in August 2020, provides the national framework for energy planning, that identifies priority renewable and thermal energy projects to meet growing energy demand. While this program supports the implementation of only the aspects of the IRP that relate to renewable energy, it offers an opportunity for strategic engagements with the Government of Botswana (GoB) on the country’s transition to clean energy. In this regard, the program contributes to the introduction of at least 50MW and 100MW wind and solar PV capacity, respectively - in the period 2024 to 2027 in terms of the IRP. Furthermore, the project supports the GoB in closing critical gaps in policy, regulatory and legal frameworks identified at the Africa Energy Market Place (AEMP 2019) and 2021 Completion Report of the Country Strategy Paper (CSP) – for instance the requirement for least-cost planning, reduction of adverse environmental impacts and increased private sector participation by promoting renewable energy (RE) IPPs. The original scope of the technical assistance project that was cleared by the SEFA Management Committee (SMC) included capacity-building and support in the implementation of Botswana’s RE IPP procurement, to enable the implementation of the IRP (see Annex II). However, after the approval in March 2021 of the Bank’s project the GoB requested the Bank to downscale the project’s scope (in July 2021). Consequently, the Bank offered to limit the technical assistance to policy, regulatory and institutional frameworks. The current project consists of activities aimed at strengthening the environment to encourage renewable energy generation investments as part of the implementation of the IRP, namely: 1) review of policy, regulatory and institutional frameworks; and, 2) development of regulatory instruments and tools to facilitate the procurement of RE IPPs. The project will draw lessons from other Bank-sponsored RE IPP programs in Algeria, Angola, Ethiopia and Nigeria.