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Energy stakeholders call for new financing mechanisms to support off-grid and mini-grid connectivity in Africa

Energy stakeholders call for new financing mechanisms to support off-grid and mini-grid connectivity in Africa

Energy industry stakeholders attending the 5th Energy Access Investment Forum have called for a restructuring of the financing mechanisms enabling the development of off-grid and mini-grid connectivity in Africa.

“Meeting the universal electricity access objective within the next decade will require the roll-out of off-grid and mini-grid solutions at scale,” said Daniel Schroth, acting director of renewable energy and energy efficiency at the African Development Bank, in his opening remarks.

The African Development Bank has developed financing instruments for engaging the off-grid and mini-grid sector through its sponsorship and anchor investment in the Facility for Energy Inclusion (FEI), a $500 million debt financing facility targeting small scale renewable energy projects.

The 5th Energy Access Investment Forum took place from 13th to 14th March in Abidjan, Cote d’Ivoire, for the first time on the continent, with the support of the Bank, the Alliance for Rural Electrification (ARE), GET.invest (formerly the Africa-EU Renewable Energy Cooperation Programme), the ECOWAS Centre for Renewable Energy and Energy Efficiency (ECREEE) and UNIDO. The forum brings together public, private, and other stakeholders to encourage clean energy access globally, and particularly in Africa.

Despite Africa’s significant energy resources endowments, close to 600 million people on the continent are still without access to electricity. Clearly, inadequate investment lies at the heart of Africa’s energy paradox.

“This forum is certainly an opportunity for investors, project developers and other stakeholders to learn more about upcoming support schemes, innovative products and new business models to accelerate rural electrification and advance the market for decentralised renewable energies,” said Marcus Wiemann, Executive Director of ARE and the 2019 Conference Chair.

Mahama Kappiah, Executive Director of ECREEE, said that lack of adequate project management in Africa’s energy sector was a major drawback to private investments. “The money is not the problem. The way projects in the energy sector are prepared for financing is the problem…we need to address the institutional and regulatory issues in the energy sector so that Africa can attract more private investments,” Kappiah said, during a session entitled “International Funding Initiatives to support the Off-grid Renewable Energy Sector”.

In his contribution, Joao Cunha, Manager of the renewable energy initiatives division at the African Development Bank, said: “The African Development Bank has been a strong supporter of Africa’s energy sector. It’s a top priority…we can see that the sector is evolving as decentralised energy systems are fast expanding with the proliferation of off-grid technologies…so, de-risking investment upfront is key to attracting more investment.”

Long Cheng, General Manager for Africa at Trina Solar, highlighted the importance of solar technologies in providing solutions that meet the needs of rural communities in Africa. “Solar energy is also an important contributor to the continent’s climate agenda,” Cheng said.

These investments need to focus on “not just off-grid but also mini-grids,” argued Dominiek Deconinck, Fund Manager at Electrification Financing Initiative (ElectriFI). Business plans and discussions in this regard ought “to focus on converting interest into investments in the off-grid sector,” he said.


 

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Following reverse listing, public can now acquire shareholding in Paratus Namibia

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20 February 2020, Windhoek, Namibia: Paratus Namibia Holdings (PNH) was founded as Nimbus Infrastructure Limited (“Nimbus”), Namibia’s first Capital Pool Company listed on the Namibian Stock Exchange (“NSX”).

Although targeting an initial capital raising of N$300 million, Nimbus nonetheless managed to secure funding to the value of N$98 million through its CPC listing. With a mandate to invest in ICT infrastructure in sub-Sahara Africa, it concluded management agreements with financial partner Cirrus and technology partner, Paratus Telecommunications (Pty) Ltd (“Paratus Namibia”).

Paratus Namibia Managing Director, Andrew Hall

Its first investment was placed in Paratus Namibia, a fully licensed communications operator in Namibia under regulation of the Communications Regulatory Authority of Namibia (CRAN). Nimbus has since been able to increase its capital asset base to close to N$500 million over the past two years.

In order to streamline further investment and to avoid duplicating potential ICT projects in the market between Nimbus and Paratus Namibia, it was decided to consolidate the operations.

Publishing various circulars to shareholders, Nimbus took up a 100% shareholding stake in Paratus Namibia in 2019 and proceeded to apply to have its name changed to Paratus Namibia Holdings with a consolidated board structure to ensure streamlined operations between the capital holdings and the operational arm of the business.

This transaction was approved by the Competitions Commission as well as CRAN, following all the relevant regulatory approvals as well as the necessary requirements in terms of corporate governance structures.

Paratus Namibia has evolved as a fully comprehensive communications operator in Namibia and operates as the head office of the Paratus Group in Africa. Paratus has established a pan-African footprint with operations in six African countries, being: Angola, Botswana, Mozambique, Namibia, South Africa and Zambia.

The group has achieved many successes over the years of which more recently includes the building of the Trans-Kalahari Fibre (TKF) project, which connects from the West Africa Cable System (WACS) eastward through Namibia to Botswana and onward to Johannesburg. The TKF also extends northward through Zambia to connect to Dar es Salaam in Tanzania, which made Paratus the first operator to connect the west and east coast of Africa under one Autonomous System Number (ASN).

This means that Paratus is now “exporting” internet capacity to landlocked countries such as Zambia, Botswana, the DRC with more countries to be targeted, and through its extensive African network, Paratus is well-positioned to expand the network even further into emerging ICT territories.

PNH as a fully-listed entity on the NSX, is therefore now the 100% shareholder of Paratus Namibia thereby becoming a public company. PNH is ready to invest in the future of the ICT environment in Namibia. The public is therefore invited and welcome to acquire shares in Paratus Namibia Holdings by speaking to a local stockbroker registered with the NSX. The future is bright, and the opportunities are endless.