Lomé, Togo, August 3, 2022 —To help Togo transition towards cleaner and safer energy sources, IFC today announced a financing package for Zener SA, a leading integrated energy provider, to help reduce the use of polluting fuels for cooking in the country and mitigate climate change.
The EUR 16.2 million IFC-led financing package for Zener, which operates across Togo's full liquified petroleum gas (LPG) value chain, comprises a loan of EUR 8.1 million of IFC's own account, and a parallel loan of EUR 8.1 million to be mobilized from other partners. The funding will enable Zener to expand its LPG storage terminals in Togo by an additional 3,600 tons for both propane and butane LPG, and equip five gas retail filling stations being constructed by the company with LPG bottle exchange stations and solar kits.
The financing is aimed at increasing access to LPG as domestic energy in Togo. More than 90 percent of the country's population uses biomass, such as charcoal and firewood, as its primary energy source for cooking, contributing to high levels of deforestation, greenhouse gas emissions, and negative health impacts from indoor air pollution, especially for women and children. Carbon emissions are cut by half when LPG replaces wood or coal, and about a third when it replaces fuel oil or kerosene. Building LPG distribution capacity and infrastructure will also help develop Togo's manufacturing and power sectors.
"Zener owns the only seaborne LPG import terminal in Togo, which is currently operating at maximum capacity. The support from IFC will enable Zener to expand the terminal to continue increasing LPG adoption and help reduce the country's carbon footprint as consumers adopt LPG as a better alternative to biomass fuels," said Jonas Daou, Zener's Managing Director.
Zener was identified by IFC under a pilot initiative called "Local Champions," a program developed to support high-potential domestic companies in low-income markets. In addition to this financing arrangement, Zener has also received IFC advisory support, including a technical and needs assessment of its LPG cylinder manufacturing plant, and an independent market study of the LPG market in Togo.
"Togo's LPG market remains small compared to neighboring countries' due to a lack of enabling infrastructure," said Kyle Kelhofer, IFC's Senior Country Manager for Togo. "IFC's financing will help Zener expand capacity in the comparatively lower-carbon LPG value chain and thus improve service quality and distribution efficiency, as well as the export of LPG to neighboring landlocked countries. That aligns with the government's goal to position Togo as a regional hub, and supports efforts towards a lower carbon economy in Togo."
IFC's strategy in Togo focuses on agribusiness, infrastructure, power, ICT, manufacturing, transport, and logistics.
About IFC
IFC—a member of the World Bank Group—is the largest global development institution focused on the private sector in emerging markets. We work in more than 100 countries, using our capital, expertise, and influence to create markets and opportunities in developing countries. In fiscal year 2021, IFC committed a record $31.5 billion to private companies and financial institutions in developing countries, leveraging the power of the private sector to end extreme poverty and boost shared prosperity as economies grapple with the impacts of the COVID-19 pandemic. For more information, visit www.ifc.org.
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