AfDB Receives $20m to Invest in Clean Energy

By Adedapo Adesanya

African Development Bank (AfDB) disclosed yesterday that it has received $20 million investment from the Clean Technology Fund (CTF) for the Facility for Energy Inclusion (FEI).

The bank said, “FEI is a $500 million financing platform whose objective is to catalyse financial support for innovative energy access solutions.”

It made this known in a statement on Wednesday, stating that the Facility for Energy Inclusion (FEI) was sponsored by the AfDB to provide sustainable financing for small-scale renewables in Africa.

“FEI on-grid, a targeted $400 million 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,” the statement read.

AfDB said the Clean Technology Fund (CTF) investment was composed of a $4m junior equity tranche and a $16m senior concessional loan.

It also said the $20 million 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, disclosed that 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.