African Development Bank says it has received $20m investment from the Clean Technology Fund for the Facility for Energy Inclusion.
The bank, in a statement on Wednesday, said the Facility for Energy Inclusion was sponsored by the AfDB to provide sustainable financing for small-scale renewables in Africa
The bank said, “FEI is a $500m financing platform whose objective is to catalyse financial support for innovative energy access solutions.
“FEI on-grid, a targeted $400m fund, supports improved energy access through the development of small-scale renewable energy generation and mini-grids across Africa, while the Off-Grid Energy Access Fund, a targeted $100m fund, supports off-grid energy distribution companies and boosts their long-term capacity to access capital markets at scale.”
AfDB said the CTF investment was composed of a $4m junior equity tranche and a $16m senior concessional loan.
It said the $20m investment would be drawn from the Dedicated Private Sector Program III, which was designed to provide risk-appropriate capital to finance high-impact, large-scale private sector projects in clean technologies.
The Director of Climate Change and Green Growth, AfDB, Mr Anthony Nyong, said the funds would contribute to economic and social growth and enhance its recipients’ resilience to the effects of negative climate change.
Nyong said, “Access to affordable and reliable energy has huge benefits at various levels of any society. Most of the 600 million people estimated to lack access to modern energy services in sub-Saharan Africa are also among the most vulnerable to the disastrous consequences of climate change.”
He added that the FEI was expected to contribute to the installation of around 600 megawatts of renewable energy projects across different African countries.
According to him, the move will stop over 30 million tonnes of carbondioxide equivalent of greenhouse gas emissions over a period of 20 years while yielding positive gender and social outcomes.