AfDB Okays USD 25 Million For Renewable Energy In Africa
From the USD 250 Mn private equity fund for renewable projects across Africa, the African Development Bank (AfDB) has given approval for funds worth USD 25 Mn in ARCH Africa Renewable Power Fund (ARPF).
This development is in line with AfDB’s ten-year Strategy and High-Five priorities, an energy-focused deal expected to see Africa achieve universal access by 2025.
According to an official statement, the ARPF will add to the 533 megawatts of installed energy generation capacity from renewable energy in Sub-Saharan Africa, providing equity for the development and construction of 10 to 15 greenfield renewable energy projects in the region.
The projects to be in the reception of this fund are expected to be put their backs into various power generation sources such as wind, solar photovoltaic, small to medium hydro, geothermal and biomass. There is as well room for grid-connected independent power producers and decentralized energy projects.
“The fund’s strategy is to prioritize projects with a clear timeline to financial close, with emphasis on de-risking early stage greenfield projects,” said the regional financier.
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Sub-Saharan Africa, having been listed by the IMF as one of the fastest growing regions in the world, is doing a number to better its electrification deficit. The USD 25 Mn from AfDB is expected to go a long way in providing power for homes and offices even in the rural areas.
“Energy investments in Africa are constrained by limited well-structured, bankable projects, as well as by unavailability of risk capital. Renewable technologies require additional support to be fully competitive over fossil fuel-based energy generation,” said Amadou Hott, the Bank’s Vice-President for Power, Energy, Climate Change & Green Growth.
Barely a week ago, the AfDB gave the green light for the disbursement of USD 32.5 Mn equity investment in Climate Investor One’s Construction Equity Fund (CEF). The funds were approved for the CEF to use its uniquely-blended approach to target the entire asset lifecycle to deliver renewable energy in Africa.
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