The Board of the Green Climate Fund (GCF) has approved Ksh. 18,448,655,000 ($170.9 million) in financing for the African Development Bank’s (AfDB) Leveraging Energy Access Finance Framework (LEAF) program.
The LEAF program aims to unlock commercial and local-currency financing for Decentralized Renewable Energy (DRE) projects in six program countries. These include Kenya, Ghana, Guinea, Ethiopia, Nigeria and Tunisia. The GCF’s financing is part of an overall Ksh. 97,155,000,000 ($900 million) program budget which aims to scale up mini-grids, solar home systems, and commercial solar solutions in the program countries.
Tony Clamp, acting Director of GCF’s Private Sector Facility commented, “GCF is delighted to partner with the African Development Bank to support this timely and critical program for decentralised renewable energy across these six African countries. Green Climate Fund’s commitment will help unlock much-needed commercial capital and local currency financing to help overcome financing barriers exacerbated by Covid-19.”
Under LEAF, Africa’s solar resources will be harnessed to provide renewable energy to 6 million people and businesses. The projects will also prevent 28.8 million tonnes in CO2 emissions over the lifetime of the systems.
By deploying credit enhancement instruments and technical assistance, LEAF will strengthen capital markets and crowd-in private sector investors. This includes local financial institutions, green mini-grids, and solar solutions for commercial and industrial sectors. The program will also provide requisite support to strengthen the enabling environment and increase private sector investment in this market segment.
“GCF’s approval of LEAF is a significant boost for the African Development Bank’s twin ambitions of accelerating electricity access and supporting the transition to clean energy on the continent using decentralized renewable energy solutions, and moreover facilitated through local financing,” said Dr. Kevin Kariuki, the AfDB’s Vice President for Power, Energy, Climate and Green Growth.