The African Development Bank and the Bank’s Sustainable Energy Fund for Africa (SEFA) have approved a combined-equity investment of $20 million in the AfricaGoGreen Fund. This is a debt fund which was established to promote private investments in energy-efficient technologies and business models, with the objective of decarbonising African economies and accelerating the energy transition.
These new investments come on top of $11.5 million equity contribution approved by the Nordic Development Fund (NDF) in December 2021. NDF provides financing to climate change mitigation and adaptation activities within the nexus of climate change and development. NDF is also a donor to SEFA, thus reinforcing the close partnership to advance the transition to cleaner and greener solutions for the continent while encouraging the participation of the private sector.
Launched in early 2021 with EUR 45 million in catalytic capital, the AfricaGoGreen Fund is a flagship project under the G20 Compact with Africa.
The Fund approved its first deal in August 2021, a loan to AktivCo – a company that finances clean energy solutions for powering telecommunication towers located in Burkina Faso, Cameroon, Chad, Côte d’Ivoire, and Niger. Also, in December 2021, it made an additional approval of a $5.5 million loan to BBOXX, a technology company exploring energy solutions that would provide electricity and other utilities to the millions without them, for the expansion of access to clean cooking solutions.
The AfricaGoGreenFund provides flexible and tailored debt instruments to private businesses in green appliances for domestic and industrial processes, green buildings, e-mobility solutions, and battery energy storage projects. It is managed by LHGP Asset Management, part of the Lion’s Head Global Partners group.
Dr. Kevin Kariuki, African Development Bank Vice President for Power, Energy, Climate and Green Growth, had this to say, “This combined Bank investment will lead to increased financing of emerging projects and businesses in the areas of industrial appliances, electric mobility and green buildings, which are key to the decarbonization of African economies and to a just energy transition.”