Facility for Energy Inclusion Off-Grid Energy Access Fund (FEI OGEF) has received a total investment of $55 million from the African Development Bank (AfDB) and various partners.
FEI OGEF is a $100 million blended finance company that matches local currency debt instruments with recent innovations in off-grid energy business models.
The fund seeks to attract participation and investment from commercial entities and development finance institutions, while offering various risk shields.
The aim of the fund is to to scale up energy access for rural households, through microgrid and energy strorage technology. In turn, this supports the AfDB's New Deal on Energy for Africa "High 5" priority, which is to connect 75 million households to off-grid energy by 2025.
The fund is managed by Lion's Head Global Partners, operating in Nairobi, Lagos and London.
The fund will begin undertakings in East Africa as well as Ivory Coast, Ghana and Nigeria.
The AfDB board has approved an investment of US$30 million into the FEI OGEF.
Additional investors include Calvert Impact Capital (CIC), $10 million, Global Environment Facility (GEF) with $8.5 million and $7.2 million from the Nordic Development Fund (NDF).
In addition, the NDF will provide a US$607,000 grant for technical assistance to support deal structuring and capacity development.
"FEI OGEF is the first bank instrument that enables debt financing, including in local currency, to off-grid energy access companies who need growth capital to expand their operations across Africa. The strong collaboration of the bank, SEFA and NDF in preparing and creating this fund, and the co-investment by the GEF and CIC, demonstrate the power of partnerships for clean energy access in Africa," said Astrid Manroth, director of transformative energy partnerships at the AfDB.
"This initiative highlights the close and constructive working relationship between NDF and the AfDB. Now we have a fully packaged investment vehicle to bring to market scaling up proven clean off-grid energy solutions to the energy access challenge on the continent," said NDF Managing Director Pasi Hellman.
"We are excited to work with the AfDB and the other investors to scale this facility and increase access to clean electricity for off-grid households in Africa," said Jenn Pryce, president and CEO of Calvert Impact Capital.