The African Development Bank (AfDB), the Nordic Development Fund and other partners have granted US$58mn to support the Off-Grid Energy Access Fund (OGEF)
The Fund is part of AfDB’s sponsored Facility for Energy Inclusion (FEI), a US$500mn debt platform to mobilise capital market funds for innovative energy access strategies. The first financial close, which took place 2 August 2018, follows the official launch of FEI at the Africa Energy Market Place (AEMP), which was held in Abidjan from 5-6 July 2018.
The initiative was presented to representatives of five African countries - Côte d'Ivoire, Ethiopia, Egypt, Nigeria and Zambia - as well as leaders from the private sector and development partner communities.
FEI is a flagship programme and part of the bank’s new deal on energy for Africa, a High5 priority to light up and power the continent.
OGEF has been designed to provide flexible debt instruments to companies in the household energy access sector including distributors, manufacturers and end-user credit providers. The Fund promotes financially sustainable mechanisms to provide access to clean electricity for underserved households through local capital markets.
The energy fund has received significant technical and financial support from important bank partners such as the UK Department for International Development (UK DFID), the Power Africa initiative of the US government and the Shell Foundation. LHGP Asset Management, a UK Financial Conduct Authority-regulated alternative fund manager, manages OGEF.
“OGEF is the result of a strong partnership between our institutions and a perfect case study for making blended finance work for climate, green growth and the Sustainable Development Goals,” said Pasi Hellman, managing director at the Nordic Development Fund.
LHGP, Calvert Impact Capital, All On, a Nigeria-based off-grid energy impact investment company, welcomed the finalisation of the financial close as a major milestone in the provision of affordable power to unserved and underserved communities.
“The energy access sector demonstrates the vibrancy and innovation in Africa for market solutions to fundamental challenges. LHGP is excited to be the manager of OGEF and engage local capital markets towards the goal of connecting millions of households to electricity,” said Clemens Calice, LHGP partner.
João Duarte Cunha, manager for energy initiatives and partnerships at the bank, further underscored, “This broad partnership is a reaffirmation of the bank’s catalytic role in financing renewable energy projects of all scales across Africa.”
