AfDB, others support green electricity startups with $2b
More than $ 2 billion have been deployed by African Development Bank Group (AfDB) and other donors this year to support green electricity startups in Nigeria and the rest of Africa.
In February, AfDB approved the Leveraging Energy Access Finance Framework (LEAF), under which the Bank will commit up to $164 million to promote decentralised renewable energy in six African countries. The $800 million programme will help spur commercial and local currency investments to scale up the activities of decentralised renewable energy companies in Ghana, Guinea, Ethiopia, Kenya, Nigeria, and Tunisia. Under LEAF, some 18 decentralised renewable energy projects are expected to be financed, providing access to six million people and businesses, resulting in 28.8 million tonnes CO2 eq. in greenhouse gas emission reductions over the lifetime of the systems.
The AfDB developed the LEAF programme, in collaboration with the Green Climate Fund, which approved $170.9 million in concessional financing for it in July last year. The framework forms part of the bank’s broader off-grid strategy under the New Deal on Energy for Africa and complements existing initiatives, such as the Sustainable Energy Fund for Africa.
AfDB President, Dr. Akinwumi Adesina at the 8th Tokyo International Conference on African Development (TICAD8) in the Tunisian capital of Tunis named renewable energy as among vital investment sectors.
AfDB manages Sustainable Energy Fund for Africa (SEFA), a multi-donor Special Fund.
It provides catalytic finance to unlock private sector investments in renewable energy and energy efficiency. The Fund’s overarching 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.
This year, also Canadian investor FinDev Canada has put in $ 13 million into the Energy Entrepreneurs Growth Fund (EEGF) that invests in early and growth-stage energy startups in
Dubai based Research firm Magnitt, said Africa energy startups drove 67 percent of the hundreds of millions of dollars raised energy startups in the first half of this year. All On Hub, in partnership with the Nigeria Climate Innovation Centre (NCIC),also announced that an $80,000 grant funding has been awarded to eight winners of the 2022 edition of the annual incubation programme for early-stage renewable energy entrepreneurs. They are: Retile, Let It Cold, Energy Assured, Nutrideen Agriculture Concepts, Danwawo Group, Swift Tranzact, Solaris Greentech Hub and Powerbox Energy Systems.
Energy for All Forum in Kigali, Rwanda, Chief Executive Officer ,ACOB Lighting Technology Ltd. Alexander Obiechina,lamented that although investor interest is increasing in Africa, the majority of funding in the sustainable energy sector still goes to foreign-owned companies.
In addition to negative perceptions, Obiechina said African startups do not receive as much government support or technical assistance as their international counterparts.