The African Development Bank (AfDB) and the African Biofuel and Renewable Energy Company (Lomé, Togo) have initiated a new fund to support solar and other renewable energy projects in Sub-Saharan Africa. The Africa Renewable Energy Fund (AREF, Nairobi, Kenya) has closed on an initial investment of USD 100 million.
AREF will target independent power producers from 5 to 50 MW in size, with a commitment of USD 10–30 million per project. The fund will have the capacity to source further funding from co-investors for larger projects.
“Over the past decade, the AfDB has established itself as a prime catalyst for renewable energy investment on the continent and is currently hosting the Africa Hub for the Sustainable Energy for All (SE4All) initiative,” said AfDB Regional Director for the East Africa Resource Center Gabriel Negatu.
“As Africa’s largest infrastructure finance partner, we understand the value of supporting both large-scale and small-scale projects as part of our strategy for Africa to promote inclusive and sustainable growth.”
AfDB leads with USD 65 million in funding, AREF is targeting USD 200 million in investments in the next 12 months. AfDB had committed USD 65 million to the fund through its statutory resources as well as climate finance instruments including Sustainable Energy for Africa and Global Environmental Facility.
Other investors include the West African Development Bank BOAD (Lomé, Togo), Ecowas Bank for Investment and Development (Lomé, Togo), Dutch Development Bank FMO (The Hague) and the Calvert Foundation (Bethesda, Maryland, U.S.). Berkeley Energy Africa Ltd. (Nairobi, Kenya) and ABREC are the vision-bearers of the fund, and Berkeley Energy will serve as fund manager.