The African Development Bank (AfDB) has reached a close on financing agreements for a $20-million-dollar concessional investment from the Sustainable Energy Fund for Africa (SEFA) for the COVID-19 Off-Grid Recovery Platform (CRP).
In a statement from the AfDB on Sunday, the concessional loan agreements were signed following approval by the board of directors of the bank in December 2020, for the $20-million-dollar concessional investment from SEFA, to establish the platform.
The agreements were signed with fund managers Lion’s Head Global Partners, Triple Jump, and Social Investment Managers and Advisors.
Harry Guinness, Managing Director, Off-Grid Energy Access Fund, part of the wider Facility for Energy Inclusion, expressed gratitude for the support from the AfDB.
“Lion’s Head is immensely grateful for the support from the AfDB, in particular the SEFA team and funders, for developing this innovative and catalytic co-investment instrument.
“African markets have been disproportionately affected by COVID-19 due to lack of infrastructure, macro vulnerabilities, especially in terms of currency and credit shocks and increasing global protectionism,” Guinness said.
Also, Jan-Henrik Kuhlmann, Head of Sustainable Energy, Triple Jump, said: “The COVID-19 Off-Grid Recovery Platform comes at a critical moment for early-stage energy access companies affected by COVID-19 and allows the Energy Entrepreneurs Growth Fund to continue releasing flexible capital into the sector at a time when risk capital is increasingly scarce.”
Furthermore, Asad Mahmood, Chief Executive Officer and Managing Partner, Social Investment Managers and Advisors, said the AfDB’s relief efforts were market-driven and flexible, and would help to leverage existing funds to ultimately assist energy distribution business in Africa.
Joao Duarte Cunha, Division Manager for Renewable Energy, AfDB, said the pandemic had jeopardised the progress achieved over the last decade in electrification, through off-grid technologies across Africa.
Duarte Cunha, however, expressed delight that the initiative would increase the resilience of the sector.
“(We) look forward to working closely with our partners to safeguard energy access services and enable continued business expansion through and beyond the crisis.”
The COVID-19 Off-Grid Recovery Platform (CRP)supports businesses commercialising solar home systems, green mini-grids, clean cooking, and other renewable energy access solutions in mitigating the impacts of the pandemic and ensuring enhanced commercial recovery of the industry.
Through this Platform and other renewable energy initiatives, the AfDB is committed to building a sustainable and more climate-resilient future by catalysing private investment in low carbon infrastructure.
This is as a means to create green jobs, diversify national energy sectors, accelerate green growth and increase the climate resilience of rural communities.
Meanwhile, SEFA is the special fund, managed by the bank, to provide catalytic finance for renewable energy.
SEFA’s goal is to contribute to universal access to affordable, reliable, sustainable, and modern energy services for all in Africa, in line with the New Deal on Energy for Africa and Sustainable Development Goal 7.
It was established in 2011 in partnership with the Government of Denmark and has since received contributions from the governments of the U.S, U.K, Italy, Norway, Spain, Sweden, the Nordic Development Fund and Germany. (NAN)