ADB, Partners Commit $85.7 Million For The First Solar And BESS Project In Timor-Leste

The Asian Development Bank (ADB), together with the Government of Canada, the Japan International Cooperation Agency (JICA), and the World Bank Group, has announced a major investment to support Timor-Leste’s first utility-scale solar and battery energy storage project. The initiative marks a significant milestone in the country’s clean energy transition and is also the nation’s first independent power producer (IPP) project. The project is expected to reduce the country’s dependence on imported diesel, improve energy security, create jobs, and promote sustainable economic growth.

The project will be developed and operated by Manatuto Renewables Power. It includes the construction of a 73.7 MW AC grid-connected solar photovoltaic (PV) plant along with an 80.2 MWh battery energy storage system (BESS), transmission lines, and related infrastructure. Once operational, the solar plant is expected to generate enough electricity each year to meet the average power needs of around 80,000 households, benefiting nearly 400,000 people across Timor-Leste. The electricity generated by the project will be supplied to Electricidade de Timor-Leste, Empresa Publica (EDTL, E.P.) under a 25-year power purchase agreement.

The total financing package for the project is valued at $85.7 million. ADB will provide $12.2 million in senior loans, while the International Finance Corporation (IFC), a member of the World Bank Group, will contribute $19 million. JICA will also provide $12.2 million in financing. In addition, the project includes $21.2 million in concessional loans from ADB’s Leading Asia’s Private Infrastructure Fund 2 (LEAP2), supported by JICA and the Government of Canada through the Canadian Climate and Nature Fund for the Private Sector in Asia (CANPA). Another $21.2 million will come from the International Development Association’s Private Sector Window (IDA PSW) and the IFC Concessional Capital Window.

ADB also served as the transaction advisor to EDTL, E.P., overseeing the project’s structuring and competitive bidding process. The project was awarded to EDF Power Solutions, a subsidiary of EDF Group, and I-Environment Investments Pacific Pty Ltd, a wholly owned subsidiary of ITOCHU Corporation. The World Bank Group acted as the lead arranger for the financing package.

Officials from the participating organizations highlighted the importance of the project for Timor-Leste’s long-term energy goals. Paulo da Silva, Executive Commission President of EDTL, E.P., said the project represents a major step toward achieving the country’s National Strategic Development Plan 2011–2030, which targets meeting 50% of national energy demand from renewable sources by 2030. He noted that the project will lower energy costs, improve energy security, and contribute to a cleaner future.

ADB Country Operations Head for Timor-Leste Michael Walsh said the project demonstrates that private investment in large-scale renewable energy is possible even in fragile and small island developing countries. He added that the use of concessional financing is expected to increase investor confidence and encourage further renewable energy investments in the region.

Representatives from Canada, JICA, and the World Bank Group also emphasized their commitment to supporting Timor-Leste’s sustainable development. They described the project as a landmark investment that will help diversify the country’s energy mix, reduce reliance on imported fossil fuels, and create new economic opportunities.

To further strengthen investor confidence, the Multilateral Investment Guarantee Agency (MIGA), part of the World Bank Group, has approved a 20-year political risk insurance guarantee for EDF Power Solutions and I-Environment Investments Pacific. The guarantee will protect their investments in Manatuto Renewables Power, with part of the coverage supported through the MIGA Guarantee Facility under the IDA Private Sector Window. Together, the financing and risk mitigation measures are expected to demonstrate the commercial viability of renewable energy projects in Timor-Leste while attracting greater private sector participation in the country’s clean energy sector.