African Development Bank secures nearly $90 million in new donor funds to transform the Sustainable Energy Fund for Africa
The African Development Bank announced US$90 million in new donor commitments for the Sustainable Energy Fund for Africa this week when the Fund’s transformation into a Special Fund was also unveiled.
The new Sustainable Energy Fund for Africa Special Fund is expected to expand, be more flexible, as well as more responsive to Africa’s fast changing energy market, with a sharper focus on green mini-grids and green baseload, and offering a wider array of catalytic finance instruments.
Over 300 development partners and financiers attended the launch event, as well as representatives of African governments and energy sector institutions, project developers and sponsors, commercial banks and infrastructure funds.
The event was an occasion for Sustainable Energy Fund for Africa donors to reaffirm their support for the Fund’s institutional priorities.
“Denmark has the development goal of providing clean energy to 5.8 million people in Africa. The Sustainable Energy Fund for Africa has proven that it has the capacity to implement innovative renewable energy projects – even in difficult circumstances,” said Danish Minister for Development Cooperation, Flemming Møller Mortensen.
Denmark, Sustainable Energy Fund for Africa’s founding partner and first donor, also unveiled US$10.65 million in fresh commitments; it was also announced during the launch that Germany and the Nordic Development Fund became Sustainable Energy Fund for Africa donors in 2020.
Germany extended US$60.97 million to support Sustainable Energy Fund for Africa’s green baseload activities, which aim to promote more sustainable baseload power generation options and prevent countries from locking themselves into environmentally damaging and potentially economically costly technologies.
“Climate change is advancing fast and knows no borders, we can only tackle it together and in solidarity. For many years, the African Development Bank is a trusted partner for Germany and one of the most important driving forces behind a structured energy transition in Africa,” said Maria Flachsbarth, Parliamentary State Secretary of the German Ministry of Economic Cooperation.
The Nordic Development Fund Managing Director Karin Isaakson, announcing a US$12.19 million commitment, noted that “Sustainable Energy Fund for Africa’s proven capability to promote early-stage projects, businesses, and markets, as well as to design and implement new and innovative financing structures and mobilise additional funding fits well with the Nordic Development Fund’s strategic pathways.”
Other significant funding came from the Swedish International Development Cooperation Agency, which has committed US$8.98 million.