At its Regional Preparatory Meeting for the Southern Africa Region, REEEP introduced the latest generation of project funding – the Phased Financing Facility – and how it can work in practice in the Southern Africa region.
“We have moved beyond ideas, and must now enter the age of implementation,” began Eva Oberender, REEEP Programme Director and manager of REEEP’s well-known project call apparatus, speaking to attendees of its annual regional preparatory meeting in Southern Africa. “We have got to make it happen.” The down-to-business mentality of REEEP has always colored its project selection and implementation throughout its over ten year history in clean energy development. With its next project call, planned for mid-year 2014, REEEP will be introducing new innovations to get more value from its clean energy projects, and provide project entrepreneurs with the longer-term support they need to take on the market.
The keystone innovation for 2014 is the Phased Financing Facility. The Facility is a unique mechanism for bridging the well-documented early-stage financing gaps faced by entrepreneurs in all sectors, but even more so in the relatively-new areas of renewable energy and energy efficiency, particularly in light of the massive political and regulatory advantages held by established “dirty” energy producers. The Phased Financing Facility brings in partner organization CTI PFAN (The Climate Technology Initiative Private Financing Advisory Network) to provide clean energy entrepreneurs with a comprehensive package of support services including bridge grants, business coaching and mentoring, advocacy, and match-making with investors for growth financing beyond the REEEP project phase. At the same time, REEEP gathers practical lessons for policy-development and delivery to help improve the environment for similar clean energy solutions.
To gain insights and advice in implementing the new project facility, REEEP brought together its Southern Africa network to discuss practical challenges and opportunities for renewable energy in the region. Jason Schäffler, Regional Technical Coordinator for REEEP’s SA Regional Secretariat, presented the Southern African perspective of REEEP’s work, noting that over one fifth of REEEP’s project portfolio is made up of sub-Saharan projects, twenty of which are in South Africa.
The region has massive renewable energy potential. The rule of thumb, noted Schäffler, is that around fifty percent of the energy is derived from traditional biomass use – technically renewable, but not necessarily sustainable. A key challenge is therefore finding modern and sustainable ways of using biomass while pursuing innovations for increased energy access through other ways. This will demand a multiple-pronged approach, looking at municipal energy provision, off-grid and mini-grid solutions in addition to regional grid integration, and holistic engagement with public and private sector actors. Participants noted that REEEP projects can be extremely helpful in providing prototype projects for municipal governments, and the policy instruments that can help other regional actors stimulate their own clean energy champions.
REEEP is now integrating the Southern African recommendations into its preparatory process for the 10th Project Call, and looks forward to continuing acting as a catalyst for clean energy development in the Southern African region.