AFRICA – The African Development Bank (AfDB), the European Commission, KfW, the Clean Technology Fund, Norfund, and other investors have committed US$160 million to the first close of the Facility for Energy Inclusion (FEI).
The bank, as the Facility’s anchor sponsor, has put up US$90 million in financing. That sum includes US$20 million that the Bank is providing in its capacity as the implementing agency of the Clean Technology Fund.
“After three years of hard work, we are pleased to see the second and larger piece of our energy access debt funding platform – FEI – up and running on the back of very significant commitments from our partners,” said Wale Shonibare, AfDB Vice-President of power, energy, climate & green growth.
In addition to the Bank’s commitment, the European Commission committed US$27.4 million to the Fund, the Norwegian Investment Fund (Nofund) committed US$23 million, and German Development Bank KfW committed US$27.4 million.
FEI will also include a US$10 million Project Preparation Facility from the Global Environment Facility that will provide reimbursable grants for transaction advisory to facilitate financial close.
“Norfund is pleased to participate in this new facility which makes debt financing available to smaller-scale renewable power projects in Africa. We anticipate that the facility will be successful in attracting private capital to this segment of the market”, said Mark Davis, Executive Vice President, Clean Energy at Norfund.
“With our investment in this flagship fund, KfW on behalf of the German Government emphasises its commitment to work with other development finance institutions to improve access to clean energy in Africa,” said Babette Stein von Kamienski, Head of Division Infrastructure, Southern Africa at KfW.
“Our junior equity investment aims at mobilising public equity and private debt investors to scale up the financial means available for innovative renewable energy projects like new mini-grids to electrify Africa.”
Projects in sub-Saharan African countries where electricity access rates are comparatively lower receive priority.
“As Fund Manager, we are excited that the limited partners have given us a flexible mandate to provide tailored financing solutions to this exciting industry which has the potential to make green growth a reality in Africa,” said Clemens Calice, Co-CEO of LHGP Asset Management, the Fund Manager of FEI.
FEI is managed by LHGP Asset Management, part of Lion’s Head Group, a fund manager focused on bringing innovative financial solutions to emerging markets and selected through an internationally competitive process.