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03/19/2014 12:58 PM     print story email story  

African Renewable Energy Fund Launches With $100 Million News

The first renewable energy fund has launched to develop projects across sub-Saharan Africa.  

Not only that, most of the money is being sourced from within Africa. $100 million has been raised so far for the African Renewable Energy Fund, with a goal of doubling that this year.

"$200 million isn't the end of it. The whole idea is that this is supposed to catalyze and crowd in other investors, so I can assure you that in a few years' time we may be looking at $500 million to $1 billion," says Gabriel Negatu, regional director of African Development Bank.

Managed by Berkley Energy Africa, the money will support small and medium-sized independent power producers with grid-tied projects of 5-50 megawatts in size: small hydro, wind, solar, geothermal, biomass and waste gas.

The Fund will commit $10-30 million for the development stage of each project, and larger projects may be able to access larger amounts.   

It will likely support the newly formed Africa Clean Energy Corridor, which 19 countries have agreed to develop to leapfrog the continent to renewable energy. 

Currently, Ethiopia hosts the continent's biggest wind farm and has plans for 800 MW of wind and 1 gigawatt of geothermal (pictured below). The Corbetti Project is a new model for developing large scale power projects in Africa and is part of the Power Africa initiative that President Obama announced last summer. South Africa has held three auctions, approving 17 renewable energy projects. 

Geothermal Great Rift Valley, Africa

The African Development Bank is the Fund's lead sponsor, contributing $65 million. It is also involved in a similar project,  Sustainable Energy for Africa (SEFA), which is supporting the early stages of projects and brokering bankable projects.

And the Bank is heavily involved with the UN's Sustainable Energy for All (SE4All) initiative, which is working to double energy efficiency and renewable energy worldwide by 2030, while giving every person access to electricity and safe fuels.

Other investors are: African Biofuel and Renewable Energy Company, which co-founded the African Renewable Energy Fund; West African Development Bank; Nigeria-based Ecowas Bank for Investment and Development; Dutch development bank Nederlandse Financierings-Maatschappij voor Ontwikkelingslanden N.V.; and US-based Calvert Foundation.

Development banks are increasingly supporting clean energy, growing by a compounded 25% a year since 2007, according to  Bloomberg New Energy Finance. 

Reader Comments (6)

Fidelis Onu

Date Posted:
03/21/14 07:15 AM

I would love to see more of Nigerian government involvement in this. We seem to be lagging behind South Africa.

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Date Posted:
03/28/14 01:44 PM

Yes, very interesting for Africa especially Uganda where we are to introduce new solar energy technology. I must see happen in Uganda as soon as possible.

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Date Posted:
04/15/14 02:59 PM

It is a great initiative to mobilize financial resources from within the continent which is crucial for growth and development sustainability.

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Date Posted:
04/16/14 07:26 AM

this is very interesting esp for Kenya where solar energy technology is getting its foothold. could someone please send me contacts of the right person I need to get intouch with to start this doscusssions urgently? and Paul am working on solar energy component with Philips covering the east African region and am yet to explore the opportunities in Uganda. hope to bring our solar community lighting technology to Uganda...

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BNL Clean Energy

Date Posted:
05/06/14 06:25 PM

Great article. We are currently identifying JV Partners in Africa to develop their market using our zero emission clean energy power plants as the lead technology. If you are a developer lease make contact

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Xara Solar

Date Posted:
07/05/14 12:18 PM

It is very nice to hear that. We deserve to take place.

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