Funds available for energy access companies and projects in Africa

Providing clean and affordable energy to the 635 million people in Africa will not come cheap. Private investors have been hesitant to engage in this sector in the past due to the high risks associated with the sector partially due to lack of sufficient data on the market.  And while there’s been a push from various sectors for access to private capital for projects and companies tackling energy access, progress has been slow.

There has however been an increase in the number of funds targeted at this particular sector. These funds are targeted at projects in various stages from ideation to scale-up and provide financing of various types from grants to equity.

Africa Enterprise Challenge Fund (AECF) – REACT (Renewable Energy and Adaptation to Climate Change Technologies) window

Type of Financing: Grants and repayable grants

County of project implementation: East Africa and Mozambique

Eligible projects: 

  • Agriculture and agribusiness
  • Renewable energy and adaptations to combat climate change
  • Rural financial services and communications systems that support these two sectors

Maximum amount: Up to $1.5 million

Financing entity(s): Governments of Australia, Canada, Denmark, the Netherlands, Sweden and the UK and The International Fund for Agricultural Development (IFAD)

Sample previous/current beneficiaries: 

  • Dobea Group Limited  – To provide 188kw of electricity to off grid rural households and business premises by using micro grid wind-solar hybrid system at four villages in Iramba district, Tanzania
  • Q Energy Supplies  – Bridging the financial gap for rural households: asset financing for domestic bio digesters – Uganda
  • BBOXX Ltd  – Solar franchising model in East Africa – Uganda & Kenya
  • African Power Initiative  – Production of biodiesel from non-food oil seeds – Uganda
  • Bridge Electric  – Accelerating access to grid-based electricity – Kenya
  • Devergy East Africa Limited – Commercial demonstration for the rapid installation of Devergy solar micro-grids – Tanzania
  • EA-Power – Decentralized electricity generation using small hydroelectric stations – Tanzania
  • Azuri Technologies  – Indigo Pay As You Go Solar – Kenya
  • FuturEnergy Ltd (now Futurepump) – To commercialise a low-cost, renewable powered irrigation pump in Kenya, called the Sunflower Pump
  • Energio Verda Africa Ltd  – Sumbawanga Renewable Grid Electrification – 2MW in Tanzania
  • Husk Power Systems – Rural Electrification Using Biomass Waste – Tanzania
  • M-KOPA – To provide “pay-per-use-purchase” mobile payment and distribution technology whose aim is to enable low-income consumers to purchase efficient, low cost solar power systems using mobile phones – East Africa
  • KGN Bio-Fuels Pvt Ltd – Biomass energy infrastructure – Kenya
  • Microenergy Credits – Microfinance clean energy product lines – Kenya, Uganda Tanzania
  • Mobisol GmbH – Mobisol-affordable and sustainable solar PV – Tanzania
  • Off Grid Electric Tanzania Ltd – To apply the mobile phone industry’s business model to the provision of electric power to off-grid homes – Tanzania
  • PowerGen Renewable Energy Ltd – Beyond Lighting: AC Micro grids for Tanzania and Kenya
  • Quite Bright Films Ltd – To travel across Kenya and in particular ASAL regions looking for the latest and most innovative devices, techniques and practices relating to renewable energy and adaptation to changing climate
  • Rift Valley Energy Ltd – Luponde hydro and rural electrification project – Tanzania
  • Schutter Energy Ltd – Delivering Lease-to-Own biogas systems to smallholder dairy farmers in Kiambu county, Kenya
  • Sahasra Electronics – LED lighting systems assembly in Rwanda
  • Safi International AS – Fully integrated value chain for ethanol cookers – Tanzania
  • SealTowers – Taking mobile network coverage and green energy to remote county regions through an independent county tower network – Kenya
  • SimGas Tanzania Ltd – Mass produced biogas systems for rural households in Tanzania
  • SincroSiteWatch – Installation of renewable energy systems in rural commuities with the telecom client as the anchor client
  • SODEA SARL  – Produce electrical energy from waste agricultural biomass and providing electricity to 2,000 households – Burundi
  • SolarNow BV  – Financing solar access to Uganda and Tanzania
  • Suntransfer Kenya Limited – Innovation to expand energy access for BOP – Kenya 2012
  • Teita Estate Ltd – Sisal biomass to energy

Sustainable Energy Fund for Africa (Project Preparation Grant)

Type of Financing: Seed/growth capital for RE projects

County of project implementation: Any African country

Eligible projects: Private and PPP projects with total capital needs of USD 30-200 million across all types of clean technologies

Maximum amount: USD 10-30 million

Financing entity(s): African Development Bank

Sample previous/current beneficiaries: 

  • Lake Assal Geothermal Project(Djibouti)
  • Jumeme (Tanzania)
  • dVentus (smart meters, Ethiopia)

Sustainable Energy Fund for Africa (Equity Investments)

Type of Financing: Seed/growth capital for RE projects

County of project implementation: Any African country

Eligible projects: Private projects sized between USD 10-80 million across mature technologies only (includes solar, wind, hydro, geothermal and stranded gas)

Maximum amount: USD 10-30 million

Financing entity(s): African Development Bank

Sample previous/current beneficiaries: Bugoye Hydro Project (Uganda)

US-Africa Clean Energy Facility (ACEF)

Type of Financing: Grant funds to overseas project sponsors for a variety of activities, including technical assistance, training programs, or early investment analysis/feasibility studies

County of project implementation: Sub-Saharan Africa

Eligible projects: RE projects that reduce carbon emissions, improve electricity access for remote populations and support economic growth.Note: Grant recipients who are not US-based companies are required to select U.S. firms to perform USTDA-funded activities

Maximum amount:

Financing entity(s): US Department of State, OPIC, USTDA

Sample previous/current beneficiaries: Off Grid Electric(Tanzania), d.light Design (expansion to Nigeria),  Gigawatt Global (Rwanda, 8.5MW solar plant)

Off-Grid Energy Challenge

Type of Financing: Grant

County of project implementation: Varies (2016 phase was open to projects in Kenya and Ethiopia only but previous phases supported projects from Ghana, Liberia, Nigeria, Tanzania, Rwanda, Uganda and Zambia)

Eligible projects: Projects by organizations that are 100% African-owned and managed. See other eligibility criteria here.

Maximum amount: USD 100,000

Financing entity(s): USADF (US African Development Foundation) partnering with USAID and GE Africa

Sample previous/current beneficiaries: Ethio Resource Group (Wind-powered 1kW micro grids in Ethiopia), New Energy (solar powered water pumping and purification in Ghana), Rafode Limited (MFI financing solar-powered lights to fishermen in Kenya), Ecovillage Community Improvement Association (Install a 50kW solar mini-grid in Liberia). See other grantees here.

Demo Environment 

Type of Financing: Two types of grants:

  • Planning grants: To provide assistance for entering a new market.
  • Demonstration grants: For organizations looking to import technology that’s new in a market

County of project implementation: Kenya, Mozambique, Tanzania, Zambia

Eligible projects: Technology that has a beneficial impact on the environment and reduction of poverty. See further criteria here.

Maximum amount: Planning grant: ~USD 40,000. Demo grant: ~USD 58,000 – 210,000

Financing entity(s): SIDA (Swedish Agency for Development Cooperation)

Sample previous/current beneficiaries: 

Energy and Environment Partnership Programme of Southern and East Africa (EEP S&EA)

Type of Financing: Grant. Two windows: innovation stage projects and market-ready projects

County of project implementation: Botswana, Burundi, Kenya, Lesotho, Mozambique, Namibia, Rwanda, Seychelles, South Africa, Swaziland, Tanzania, Uganda  or Zambia

Eligible projects: Projects with (1) clear development rationale and an economic rationale, 2) Clear demonstration of additionality, 3) Clear sustainable development outcomes, 4) Minimisation of market distortions, 5) Credible contribution to achieving systemic market impact, and 6) Incentives with commercial partners are aligned)

Maximum amount: 

Innovation window :

    • The maximum grant € 100 000 – 300 000 depending on the level of verifiable project co-financing
    •  Minimum co-financing is 30% of the requested amount

Market ready window:

  • Grant size between 200,000-1,000,000.00 EUR
  • Co-financing share progressively 30-90%

Financing entity(s): Ministry for Foreign Affairs of Finland (MFA), the Austrian Development Agency (ADA) and the UK Department for International Development (DFID).

Sample previous/current beneficiaries: 

Powering Agriculture (An Energy Grand Challenge for Development)

Type of Financing: Funding window 1: For clean energy solutions and business models in the research and development stage that need funding for proof of concept, field pilots and adapting business models/technologies for new markets. 

Funding window 2: For clean energy solutions/business models that have already been piloted successfully in a developing country/emerging market on a small scale and are now in the scale-up stage.

County of project implementation: Any country categorized as a developing country and advanced developing country as classified by the World Bank which is virtually all African countries.

Eligible projects:  (1) Clean energy solution (CES) that will have an impact on increasing use of clean energy/increasing efficiency and on increasing agricultural production and/or value.(2) CES that are market-driven i.e which specific market and an existing market demand. (3) CESs that support low-emissions economic growth among target end user. (4) CESs that contribute to reducing gender disparities to access t/control over and benefits from clean energy resources, wealth, opportunities and services. (5) Applicants must have a presence/local partner in the country of implementation. (6) Applicants must show how the funds provided will be integrated into an established business plan.

Maximum amount: Window 1: Up to $500,000. All awardees are encouraged to demonstrate a cost-share contribution of at least 15% (up to $75,000) of the total award value. 

Window 2:Between $500,000 – $2,000,000. All awardees will be required to demonstrate a 35% cost-share contribution.

Financing entity(s): United States Agency for International Development (USAID), the Swedish International Development Cooperation Agency (SIDA), the German Federal Ministry for Economic Cooperation and Development (BMZ), Duke Energy, and the Overseas Private Investment Corporation (OPIC)

Sample previous/current beneficiaries: 

  • Kickstart – Affordable solar irrigation pumps utilising the PAYG financing model
  • SimGas Tanzania Ltd –  Developing and will demonstrate off-grid, small-scale, biogas-powered milk chillers for smallholder farmers in Kenya, Tanzania and Rwanda
  • University of Georgia Research Foundation (UGARF) – Refining the design and testing od a biogas-powered evaporative cooling for dairy farmers in Uganda
  • Husk Power Systems – Solar PV-Biogas hybrid mini-gids to power households, microenterprises and agricultural processes in Ghana and Nigeria
  • African Bamboo – Developing a biomass-powered bamboo thermal modification process in Ethiopia
  • Ariya Capital Group Limited – Provide end to end cost-effective, low-risk renewable energy generation and energy efficiency services to local flower and horticulture farms in Kenya, Uganda, and Tanzania
  • The Earth Institute at Columbia University – Solar Pv micro-utilities to power small-scale irrigation in Senegal

Development Innovation Ventures (DIV)

Type of Financing: Grant 

County of project implementation: Any African country

Eligible projects: Utilizes a three-tiered stage finance model:

Stage 1 –  Proof of Concept/Initial Testing. Testing for technical, organization, distribution and financial viability.

Stage2 – Testing and Positioning for Scale. Testing for social impact, improved outcomes and/or market viability, as well as operational refinement to build paths to sustainability and scale.

Stage 3 – Transitioning Proven Solutions to Scale. This includes adaptation to new contexts and geographies.

See more detailed criteria here.

Maximum amount: Stage 1 funding levels range from $25,000 to $150,000 per project and can propose activities for up to two years. Stage 2 projects range from $150,000 to $1,500,000 and can propose activities for up to three years. Stage 3 projects range from $1,500,000 to $15,000,000 and can propose activities for up to five years.

Financing entity(s): USAID

Sample previous/current beneficiaries: 

  • Elephant Energy – Distribution of solar systems which utilize a Bluetooth-enabled PAYG platform in Namibia
  • Potential Energy – Fueling the high-efficiency cookstoves market in Ethiopia and Darfur
  • EGG-energy – Proof of concept for creation of solar-powered battery charging hubs in  Tanzania
  • Off Grid Electric – Proof of concept and testing at scale of PAYG solar home systems in Tanzania
  • d.light Design – Provision of SHSs combined with PAYG in Uganda
  • Lighting Rural Uganda with Solar (LRUS) –  Proof of concept of leveraging existing member cooperatives to provide access to more cost-efficient, cleaner lighting technology
  • Angaza – Proof of concept for PAYG software and hardware for SHSs
  • Azuri Technologies – Testing at scale of PAYG SHSs in Rwanda

Access To Energy Fund

Type of Financing:  Equity financing, subordinated debt/senior loans and it can also selectively play a role in the development of new projects by providing grants which is normally linked to a debt or equity financing from the Fund in the overall project

County of project implementation: Any African country

Eligible projects: (1) Renewable energy projects (2)Generation, transmission and distribution projects. (3) Private sector investments but might consider PPPs (4) Commercially viable projects that are socially and environmentally sustainable (5) AEF financing must be additional to other financiers and/or catalyze other investors by taking on a risk position that facilitates other potential financiers

Maximum amount: 

  • Equity – up to €10 million per project; no majority equity stakes in general (<20%)
  • Subordinated debt/senior loans – debt financing in cases where it is not readily available. The AEF funding should contribute to the bankability of projects; subordinated debt can help to fill a risk capital funding gap. AEF can offer long tenors, and ticket size is limited to a maximum of 37.5% of the total project cost (for large projects 25%
  • Development equity –to contribute to the high-risk, early stage project development phase

Financing entity(s): Dutch government and FMO Entrepreneurial Development Fund

Sample previous/current beneficiaries: 

  • Gigawatt Global Rwanda Ltd – Develop an 8.5MW solar plant in Rwanda ($1.7 million)
  • Orb Energy Pte Ltd –  Rolling out its franchised retail outlets across Kenya establishing centralized distribution infrastructure selling SHSs, solar water heaters and solar lanterns. ($2 million)
  • Ivoire Hydro Energy SA – Develop a run-of-river 44MW hydro project in Côte d’Ivoire ($ 1.5 million)
  • Global Innovative Consulting Ltd – Develop a 20MW solar plant in Nothern Ghana ($850,000)
  • EMS Africa Nyamwamba Ltd – Develop a 9.2MW run-of-river Nyamwamba hydropower plant in the West of Uganda ($5 million)
  • Riverblade Holding BV – Feasibility study for development of  2 river-based power stations with a total capacity of 6MW in Sierra Leone ($ 200,000)
  • Cenpower Generation Company Limited – Develop a 340 MW combined cycle independent power plant operating on light crude oil or gas in Ghana

Electrification Financing Initiative (ElectriFI)

Type of Financing:  Debt, quasi-equity, equity and guarantees. According to the Initiative’s site, the financiers expect “corresponding financial returns in line with local commercial market”.   

County of project implementation: Any African country

Eligible projects: (1) Companies or projects that increase access to electricity (considers both on-grid and off-grid solutions) (2)A minimum of 1,000 attributable new electricity connections.  (3)Projects currently in active development which is defined as “market analysis and validation are finalised, pilot (if applicable) has been undertaken, land is secured, resource data are acquired, and feasibility study undertaken” (4) Project must be able to gain financial sustainability in the next 2 – 3 years (5) Projects that contribute to installed renewable energy capacity . Further criteria can be found here.

Maximum amount: 

A minimum of EUR 500,000 and maximum of EUR 10 million for maximum tenure of 7 years.

Financing entity(s): European Commission and Power Africa

Sample previous/current beneficiaries: 

  • Sigora Haiti – Build a 3.5MW clean energy mini grid to connect 136,000 new customers to electricity in Haiti.

*The list of funds above is by no means exhaustive and will be updated regularly. The information presented is extracted from the funds’ online resources.

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