Project detail - Red Sea Power Limited

Red Sea Power Limited

Status: Approved investment
Back to map

Why disclosure?

FMO is committed to making publicly available relevant investment information that informs stakeholders and enables them to engage directly with FMO on its investments which, in turn, enhances our investment decisions, the design and implementation of projects and policies, and strengthens development outcomes. Learn more

In case of questions

In case of questions, please contact us at


The information as disclosed is indicative and provided on an "as-is/as available" basis for general informational purposes only and should not be construed as financial, legal or investment advice, nor as a commitment or an offer to arrange or provide any financing. The final decision to provide financing is subject to the terms and conditions of FMO in its sole and absolute discretion. When providing links to other sites, FMO bears no responsibility for the accuracy, legality or content of the external site or for that of subsequent links. The information on proposed investment for high-risk investments is made available in the language relevant to the country or region where the bulk of operations take place. Translations of any information into languages other than English are intended as a convenience for local stakeholders. In case of any discrepancy, the information provided in English will prevail.

Who is our customer

Red Sea Power Limited SAS ('RSP') is the first grid connected Renewable Energy Independent Power Producer ('RE IPP') in Djibouti. The Project has been developed by FMO Private Equity, Climate Investor One, Africa Finance Corporation and Great Horn Investment Holdings. The Project involves the construction of a c.60MW Wind Farm in Ghoubet, Djibouti. The Project also involves construction and operation of interconnection facilities comprising of a 220 MVA substation and 5km overhead transmission line to connect to the nearest Electricité De Djibouti substation.

What is our funding objective?

FMO-A senior secured loan to RSP to refinance a 60MW wind power plant and associated transmission line ('Project'), which have been constructed fully with equity.

Why do we fund this investment?

The Project fits well with the Energy and FMO strategic focus: (i) The Project creates impact through deployment of the first renewable energy power generator in Djibouti; (ii) it increases the energy security of Djibouti, which is heavily reliant on expensive and carbon intensive Heavy Fuel Oil ('HFO') power generation facilities; (iii) wind contributes to the diversification of the country’s energy mix, dominated by HFO and Ethiopian Imports (iv) being the first RE IPP in Djibouti, it sets the trend for the development of the energy sector.

What is the Environmental and Social categorization rationale?

The Project concerns the refinancing of a newly operational wind project and is categorized as an E&S B+ investment. The potential E&S risks of this specific investment are related to labour rights, a unique security context, biodiversity challenges, and management of high community expectations. FMO’s E&S due diligence indicates that the investment will have impact which must be managed in a manner consistent with the following IFC Performance Standards: PS 1: Assessment and Management of Environmental and Social Risks and Impacts, PS 2: Labor and working conditions, PS 3: Resource Efficiency and Pollution Prevention, PS 4: Community Health, Safety and Security, PS 6: Biodiversity Conservation and Sustainable Management of Living Natural Resources, and PS 8: Cultural heritage. A robust investigation at development stage confirmed that there was no physical or economic displacement, and no impact on Indigenous Peoples groups. These findings were confirmed through due diligence as well. Therefore, IFC PS5 and PS7 are not considered applicable.

Publication date
Effective date
Total FMO financing
USD 16.67 MLN
Risk categorization on environmental and social impacts, A = high risk, B+ = medium high risk, B = medium risk, C = low risk Environmental & Social Category
(A, B+, B or C)