African Development Bank Unveils $50 Million Facility for Renewable Energy Players
The African Development Bank (AfDB) has unveiled a $50 million facility that will provide relief and recovery capital to energy access businesses to enable them survive COVID-19 pandemic.
The move follows the Board of Directors of the African Development Bank approval of a $20 million concessional investment from the Sustainable Energy Fund for Africa (SEFA) to establish the COVID-19 Off-Grid Recovery Platform (CRP).
According to AfDB, the $20 million concessional envelope will be blended with their own capital and instruments, leveraging $30-$40 million in complementary commercial funding and enabling more affordable debt products.
The recovery platform is expected to support energy access companies commercializing and deploying solar home systems, green mini-grids, clean cooking and other decentralized renewable energy solutions.
“This initiative underlines the African Development Bank’s commitment to the accelerated growth of Africa’s decentralized energy industry, based on renewables, as a key driver for universal energy access goals,” said Dr. Kevin Kariuki, AfDB Vice-President for Power, Energy, Climate and Green Growth.
Triple Jump, Lion’s Head Global Partners, and Social Investment Managers and Advisors have been selected to oversee the management of the facility.
“Understanding that time is of essence, this platform will enable the provision of tailored financial solutions by leveraging existing resources, expertise and infrastructure within the sector,” said Joao Duarte Cunha, Division Manager for Renewable Energy at AfDB.
In addition to providing immediate relief and recovery support, the platform will lay the foundation for a green and inclusive economic recovery post-pandemic.
“The combination of funding and operational support will stabilize businesses and allow for continued investments during the COVID-19 crisis, mitigating the impact of the pandemic on energy access companies and set a sustainable trajectory for growth,” said Jan-Henrik Kuhlmann, Head of Sustainable Energy at Triple Jump.
The relief and recovery capital will support businesses in mitigating the impacts of the pandemic and ensuring a robust commercial recovery of the industry, and has been endorsed by leading industry associations, including the Alliance for Rural Electrification (ARE), Africa Mini-Grid Developers Association (AMDA) and the Global Off-Grid Lighting Association (GOGLA).