AfDB launches the African Renewable Energy Fund
13 March 2014, 17:48
Nairobi - Small to Medium scale Independent Power Producers (IPP) will benefit from a renewable energy fund worth KES 8.3 billion (USD 100) targeting Sub-Saharan Africa, an initiative by African Development Bank (AfDB).
Africa Development Bank (AfDB) Regional Director, Gabriel Negatu said the fund targets IPP's with an ideal size of between 5 and 50 megawatts and a commitment per project of between KES 830 million to KES 2.49 billion.
“Through Sustainable Energy for Africa (SEFA) we will additionally fund a project support facility which will provide resources to be deployed at an early stage to structure bankable deals,” said Negatu.
Negatu added that the fund will be invested in grid-connected development stage renewable energy projects including small hydro, wind, geothermal, solar, biomass and waste gas.
He reiterated that AfDB is the funds lead sponsor to the initiative, bringing in KES 5.395 billion (USD 65 million) in an equity investment package from its statutory resources as well as climate finance instruments to leverage commercial and institutional investment.
Negatu also noted that the Bank understands the value of supporting both large scale and small scale projects as part of our strategy for Africa to promote inclusive and sustainable growth.
He stated that the committed capital for the African Renewable Energy Fund (AREF) will be headquartered in Nairobi and targets a final close of approximately KES 16.6 billion within the next 12 months.
Former KenGen CEO, Eddie Njoroge who is also a member of the Investment Committee AREF fund said that it is wanting that over 580 million people have no access to electricity in Sub- Saharan Africa
“It’s unfortunate that the growing population in Africa is expected to be 2 billion by 2050 meaning that the number of missed access to electricity is likely to even get higher than it is now”, said Njoroge.
Njoroge noted that Africa has a lot of power resources including wind-power, geothermal, solar and uranium which can generate any form of power in the region for every household to benefit from electricity.
“This project is a dream coming true and the puzzle we needed has been put together and is already in place. With professionals who have passion, the demand is there, resources, and now the funding that is being put together through AfDB,” stated Njoroge.
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