The Green Climate Fund (GCF) on Wednesday announced that it has approved $170.9 million (N70.69 billion) in co-financing for the African Development Bank’s Leveraging Energy Access Finance Framework (LEAF) programme in Africa.
A statement by Olufemi Terry of the AfDB’s Communication and External Relations Department, said LEAF aims to unlock commercial and local-currency financing for decentralised renewable energy projects in six programme countries. This includes Nigeria, Ghana, Guinea, Ethiopia, Kenya, and Tunisia.
It said the Green Climate Fund’s financing is part of an overall $900 million budget whose objective is to scale up the roll-out of mini-grids, solar home systems, and commercial and industrial solar solutions in the programme countries.
Tony Clamp, acting director of GCF’s Private Sector Facility, said; “GCF is delighted to partner with the African Development Bank to support this timely and critical programme for decentralised renewable energy across these six African countries.”
Mr Clamp stated that the Green Climate Fund’s commitment will help unlock much-needed commercial capital and local currency financing to help overcome financing barriers exacerbated by Covid-19.
According to the statement, under the LEAF initiative, Africa’s abundant solar resources will be harnessed to provide renewable energy to 6 million people and businesses, and will also prevent 28.8 million tonnes in CO2 emissions over the lifetime of the systems.
It noted that 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 comprising of solar home systems, green mini-grids, and solar solutions for commercial and industrial sectors.
“The program will also provide requisite support to strengthen the enabling environment and increase private sector investment in this market segment,” the statement partly reads.
Kevin Kariuki, AfDB’s Vice President for Power, Energy, Climate and Green Growth, said; “GCF’s approval of LEAF is a significant boost for the African Development Bank’s twin ambitions of accelerating electricity access and supporting the transition to clean energy on the continent using decentralized renewable energy solutions, and moreover facilitated through local financing.”
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