The Clean Technology Fund (CTF), one of two multi-donor trust funds within the Climate Investment Funds (CIF), has approved US$20 million for the Facility for Energy Inclusion (FEI), a facility sponsored by the African Development Bank to provide sustainable financing for small-scale renewables in Africa.
FEI is a US$500 million financing platform whose objective is to catalyse financial support for innovative energy access solutions. FEI On-grid, a targeted US$400 million fund, supports improved energy access through the development of small-scale renewable energy generation and mini-grids across Africa, while the Off-Grid Energy Access Fund (OGEF), a targeted US$100 million fund, supports off-grid energy distribution companies and boosts their long-term capacity to access capital markets at scale.
The CTF investment, composed of a US$4 million junior equity tranche and a US$16 million senior concessional loan, will be drawn from the Dedicated Private Sector Program III, designed to provide risk-appropriate capital to finance high-impact, large-scale private sector projects in clean technologies.
“Access to affordable and reliable energy has huge benefits at various levels of any society,” said Anthony Nyong, Director of Climate Change and Green Growth at the African Development Bank.
“Most of the 600 million people estimated to lack access to modern energy services in Sub-Saharan Africa are also among the most vulnerable to the disastrous consequences of climate change.”