COP25 Side Event: Mobilising Investment for Off-Grid Energy Solutions in African Countries

10-12-2019, 11:30 to 13:00, COP 25, Madrid, Side Event Room 4, Spain

A high-level panel with representatives of European and African governments, international finance institutions and non-profit organisations will discuss the main barriers to the development of markets for off-grid clean energy in African countries, and share the latest insights on solutions under development in their countries and by their institutions.

A rural scene near Lusaka, Zambia

A central theme in the discussions will be the new Beyond the Grid Fund for Africa (BGFA), which aims to kick-start clean energy markets to bring clean, off-grid energy access to millions of people in Burkina Faso, Liberia, Mozambique and Zambia. BGFA builds on the success of its pilot phase, the Beyond the Grid Fund for Zambia, which helped nearly 800,000 people gain access to off-grid energy in 2.5 years and won an Ashden Award and a UN Global Climate Action Award in 2019. With an initial funding target of EUR 48 million, BGFA is an initiative of Sweden (Funder, initiator), undertaken by NEFCO (Facility Manager) and REEEP (Implementation Manager).

Organisers:

  • Renewable Energy and Energy Efficiency Partnership (REEEP; www.reeep.org)
  • Nordic Environment Finance Corporation (NEFCO; www.nefco.org)
  • International Center for Environmental Technology Transfer (ICETT; www.icett.or.jp)

Speakers

Moderator: Ash Sharma, Lead Adviser and Head, BGFA, NEFCO

  • Ndashe Yumba, Permanent Secretary in the Ministry of Lands and Natural Resources, Zambia
  • Dr. Nathaniel T. Blama, Executive Director, Environmental Protection Agency, Liberia
  • Adam Öjdahl, Adviser, Power Africa at the Swedish International Development Cooperation Agency (Sida)
  • Maher Chebbo, Chair of the Governing Board, REEEP
  • Fenella Aouane, Principal Green Finance Specialist, Global Green Growth Institute

Background

Just under 1 billion people worldwide still lack access to electricity, one of the main preconditions to prosperity growth. Despite increasingly ambitious efforts under the UN Agenda for Sustainable Development to achieve universal electrification by 2030, it is estimated that by that time nearly 600,000 people in Sub-Saharan Africa alone will still not have access to electricity, and many more will still lack access to clean cooking. Many of these people live in rural and peri-urban areas that have not been reached by the central electricity grid, and where, due to the geography and/or widely dispersed populations, expansion of the grid would be too costly and technically difficult.

Off-grid energy solutions such as mini-grids and solar home systems offer an affordable, reliable, quick-to-deploy alternative to grid extension. An increasing number of companies in Sub-Saharan Africa already offer solutions that employ innovative consumer payment schemes, often via mobile money, to ensure that the daily cost of clean energy is lower than that of candles and other traditional energy sources. However, despite great demand, the markets in which these companies operate are still viewed as risky by investors, and even successful companies face great difficulties accessing finance to scale up their businesses. Companies also struggle with unsupportive regulatory environments, the high costs of reaching customers in deep rural areas, and the need to make their solutions more affordable to those same customers.

About the Beyond the Grid Fund for Africa

The planned Beyond the Grid Fund for Africa (BGFA) aims to build markets for off-grid energy to bring access to clean, affordable off-grid energy to at least 5 million people in Burkina Faso, Liberia, Mozambique and Zambia by 2025. The programme primarily targets the framework conditions of off-grid energy markets, lowering barriers to entry and scale for the private sector; catalysing investment and economic activity; and maximising development and climate impact per unit of public financing spent. In doing so, it provides a vital structural foundation for market-led delivery of modern, clean energy services to underserved rural and peri-urban areas.

The Beyond the Grid Fund for Africa builds on the success of the Beyond the Grid Fund for Zambia (BGFZ; www.bgfz.org), which has connected 150,000 households (780,000 people) in two years and won a 2019 Ashden Award and a 2019 UN Global Climate Action Award.

A market scoping study is currently ongoing in the three new countries and for a possible new financing round in Zambia. Provided the market scoping study supports the planned expansion, and subject to the Funders’ approval, the aim is to launch Calls for Proposals in each focus country during the second half of 2020.