Aktuelle Rechtsthemen

1. Support from the World Bank

In May 2026, the World Bank announced a $250 million (approx. €215 million) programme aimed at expanding the population’s access to energy. The programme, known as ASCENT (Accelerating Sustainable and Clean Energy Access Transformation), will thus be structured around several key areas.

Firstly, the programme will seek to connect a significant proportion of the population to the grid through thousands of new connections and the deployment of mini-grids. Secondly, several off-grid power stations are set to be converted to hybrid systems, notably to reduce their reliance on diesel and improve the reliability of supply. Above all, the ASCENT programme will seek to support JIRAMA and improve its financial viability, given that its debt stands at 2,000 billion Malagasy ariary (approx. €410 million).

2. An Electricity Code adapted to financing constraints

The signing of the 46 memoranda of understanding announced by the Ministry of Energy follows a call for expressions of interest. These memoranda must be converted into contracts, in accordance with the terms set out in Law No. 2017-020 on the Electricity Code in Madagascar and Decree No. 2023-245 issued for its implementation. Malagasy legislation thus distinguishes between three different legal regimes depending on the capacity of the proposed installation:

• the declaration;
• authorisation; and
• the concession.

Regardless of which of these three regimes applies, Malagasy legislation has incorporated the key requirements for project financing:

• ownership of the assets comprising the power plant by the project company;
• the granting to that same project company of rights in rem in the form of a right of superficies;
• a contract term that takes into account the depreciation of the assets;
• the possibility of pledging or mortgaging the assets comprising the power plant;
• the project company’s entitlement to easements for the passage of power lines or the installation of anchorages on third-party land;
• the grant to the project company of a termination payment payable in the event of early termination, the terms of which are set out in the authorisation agreement or the concession contract;
• the lenders’ right of subrogation (step-in).

3. The need to cover the risk arising from Jirama’s financial position

Legal guarantees are unlikely to be sufficient for the sponsors and their lenders.

They will want to be covered against the risk of Jirama defaulting on payment for the most important projects.

The bankability of these projects in Madagascar will be conditional upon the issuance of a Partial Risk Guarantee (PRG).

In practical terms, the PRG will protect the project company against several categories of risk, in particular political risks such as expropriation or nationalisation, non-convertibility, non-transferability of revenues, losses resulting from political force majeure or a breach by the State or Jirama of its obligations under the concession, the authorisation contract or the PPA.

These guarantees may be provided by various types of entities, including public and multilateral institutions such as the Multilateral Investment Guarantee Agency (MIGA), the World Bank or the African Development Bank.