The African Development Bank Group has approved a US $6M reimbursable grant to pilot a new financing mechanism designed to expand renewable energy access in some of Africa’s most fragile and underserved markets.
The funding, provided through the Sustainable Energy Fund for Africa, will support the launch of the Peace Renewable Energy Certificate (P-REC) Aggregation Facility an innovative model that uses renewable energy certificates as a direct source of funding for mini-grid projects. The initiative is being co-financed by the Nordic Development Fund, which has committed a matching US $5.65 million, bringing the total facility size to US $11.3M. Implementation will be led by Camco Clean Energy in partnership with Energy Peace Partners, the organisation behind the P-REC concept.
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Small-scale renewable mini-grids
The facility will focus on small-scale renewable mini-grids in conflict-affected and energy-poor communities. It will enter into long-term agreements with developers across 14 countries, including Nigeria, Ethiopia and Uganda, among others. Under the structure, developers will receive upfront payments in exchange for the rights to renewable energy certificates generated by their projects. These certificates will then be sold to international corporate buyers seeking to align sustainability spending with measurable social and environmental impact. The model is expected to improve cash flow for developers operating in markets where access to commercial financing is limited.
The programme is projected to provide first-time electricity access to approximately 856,000 people, supported by around 240,000 new connections and the addition of 71 MW of renewable energy capacity. Women are expected to account for nearly half of the beneficiaries. The initiative also supports Mission 300, a joint electrification drive by the African Development Bank Group and the World Bank aimed at connecting 300 million people across Africa to electricity by 2030. Stakeholders say the facility represents a new approach to climate finance by unlocking private sector investment and addressing persistent funding gaps in rural electrification, particularly in fragile and conflict-affected regions.
