The African Development Bank (AfDB) has declared that the Off-Grid Energy Access Fund (OGEF) completed its first close with committed capital of $58 million from the AfDB, the Nordic Development Fund, the Global Environment Facility, Calvert Impact Capital and All On.
The Fund is part of the bank’s sponsored Facility for Energy Inclusion (FEI), a $500 million debt platform to catalyse capital markets support for innovative energy access strategies.
The Fund’s first close was sequel to the official launch of FEI at the Africa Energy Market Place (AEMP) on 5-6 July this year, where the initiative was presented to representatives of five African countries, including Nigeria, Côte d’Ivoire, Ethiopia, Egypt and Zambia – as well as leaders from the private sector and the development partner communities.
The AfDB’s Vice-President for Power, Energy, Climate Change and Green Growth, Amadou Hott, explained that the FEI was part of a broader bank’s strategy to unlock more financing in decentralised energy companies, which also entails direct investments in market leaders, lines of credit for local banks and programmatic support to countries in scaling-up their energy access agendas.
Hott assured: “We will keep pushing the ‘off-grid revolution’ in the African continent to achieve universal energy access by 2025,”
According to the bank, OGEF has received significant technical and financial support from key its partners, namely the United Kingdom’s Department for International Development, the United States Government’s Power Africa initiative and the Shell Foundation.
“OGEF is the result of a strong partnership between our institutions and a perfect case study for making blended finance work for climate, green growth and the Sustainable Development Goals,” said Pasi Hellman, managing director at the Nordic Development Fund.
Speaking further on the partnerships from key investors, the bank’s manager for energy initiatives and partnerships, João Duarte Cunha, at AfDB, explained that “this broad partnership is a reaffirmation of the Bank’s catalytic role in financing renewable energy projects of all scales across Africa”.
LHGP Asset Management, a UK Financial Conduct Authority-regulated alternative fund manager, from Nairobi, Lagos and London, manages OGEF.
“The energy access sector demonstrates the vibrancy and innovation in Africa for market solutions to fundamental challenges. LHGP is excited to be the manager of OGEF and engage local capital markets towards the goal of connecting millions of households to electricity”, said Clemens Calice, LHGP Partner.
