Germany has pledged to contribute US $116M to the African Development Bank‘s (AfDB) Sustainable Energy Fund for Africa (SEFA) to support private investments in renewable energy in Africa.
The funds will be injected into the Fund for Sustainable Energy in Africa (SEFA) which aims to unlock private sector investments that contribute to universal access to affordable, reliable, sustainable and modern energy services in Africa.
Sefa provides financing to renewable energy and energy efficiency providers. Recently, the fund participated in the mobilization of Africa Renewable Energy Fund II (AREF II). This fund managed by Berkeley Energy finances clean energy, including wind, solar, run-of-river hydro and storage projects in Africa.
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Capitalization target
Mr. Daniel Schroth, the AfDB’s acting director for renewable energy and energy efficiency who revealed the report said the German funding will support technical assistance and investments in power generation, transmission and distribution to increase the penetration of renewable energy in African grids.
“Germany’s new contribution is a major boost to reach Sefa’s capitalization target of $500 million. It is also a recognition of Sefa’s catalytic role in accelerating Africa’s energy transition and supporting clean energy access solutions,” said Daniel Schroth.
Berlin’s funding is part of the G20 Compact for Africa (CwA). This initiative launched under the German G20 presidency in 2017 aims to promote private investment in Africa, particularly in infrastructure. The CwA also aims to increase the attractiveness of private investment by substantially improving macroeconomic, trade and financial frameworks. The CwA works in partnership with Benin, Burkina Faso, Ivory Coast, Egypt, Ethiopia, Ghana, Guinea, Morocco, Rwanda, Senegal, Togo and Tunisia.
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