The board of the Green Climate Fund (GCF) has approved $170.9-million in financing for the African Development Bank’s (AfDB’s) Leveraging Energy Access Finance Framework (LEAF) programme.
The programme aims to unlock commercial and local-currency financing for decentralised renewable energy (DRE) projects in Ghana, Guinea, Ethiopia, Kenya, Nigeria and Tunisia.
The GCF’s financing is part of an overall $900-million programme budget that targets scaling up the roll-out of minigrids, solar home systems and commercial and industrial solar solutions.
GCF private sector facility acting director Tony Clamp says the fund is "delighted" to partner with the AfDB to support this timely and critical programme for DRE across the six African countries.
“The GCF’s commitment will help unlock much-needed commercial capital and local currency financing to help overcome financing barriers exacerbated by Covid-19.”
Under LEAF, Africa’s abundant solar resources will be harnessed to provide renewable energy to six-million people and businesses, and will also prevent 28.8-million tonnes of carbon dioxide emissions over the lifetime of the systems.
By deploying credit enhancement instruments and technical assistance, LEAF will strengthen capital markets and crowd-in private sector investors, including local financial institutions, thereby enhancing their financial and technical capacity to finance businesses in the fast-growing DRE market segment.
The programme will also provide requisite support to strengthen the enabling environment and increase private sector investment in this market segment.
“The GCF’s approval of LEAF is a significant boost for the AfDB’s twin ambitions of accelerating electricity access and supporting the transition to clean energy on the continent using DRE solutions and, moreover, facilitated through local financing,” says AfDB power VP Dr Kevin Kariuki.