….Nigeria, Ghana, Côte d’Ivoire, others to benefit
The African Development Bank (AfDB) has announced a financing arrangement with Calvert Impact Capital (CIC), Global Environment Facility (GEF) and the Nordic Development Fund (NDF) to promote off-grid energy investments in Africa.
The Board of the AfDB, through the partnership, approved a $30 million Facility for Energy Inclusion Off-Grid Energy Access Fund (FEI OGEF) following the earlier approval of additional investments of $10 million from CIC, $8.5 million from GEF and €6 million ($7 million) from NDF.
The FEI OGEF is a $100 million blended finance debt fund designed to provide loans in local and hard currencies to off-grid energy entities with the dual objectives of scaling up access to clean electricity for off-grid households and crowding in local financial institutions as co-lenders
Commenting on the latest deal, the Director, Transformative Energy Partnerships at the African Development Bank, Astrid Manroth, explained that “FEI OGEF is the first Bank instrument that enables debt financing, including in local currency, to off-grid energy access companies who need growth capital to expand their operations across Africa,” said
According to the bank, through the use of clean energy instead of fossil fuels to power communities, the fund is expected to result in the reduction of up to 8 million tonnes of CO2 emissions through 2025.
Similarly, NDF’s managing director, Pasi Hellman, enthused: “This initiative highlights the close and constructive working relationship between NDF and the AfDB.
“We have been in lock step throughout the preparation and development cycle of the Fund. Now we have a fully packaged investment vehicle to bring to market scaling up proven clean off-grid energy solutions to the energy access challenge on the continent.”
The Fun, which will be managed by Lion’s Head Global Partners operating out of offices in Nairobi, Lagos and London, has an initial focus on East Africa as well as Côte d’Ivoire, Ghana and Nigeria.
In his remarks on the partnership with AfDB, the President and CEO of Calvert Impact Capital, Jenn Pryce pointed out that the “OGEF squarely fits within our investment mandate of leveraging public capital at scale to create systemic change in sectors and geographies that have been overlooked by mainstream capital markets.”