African Development Bank backs decentralised renewable energy platform
The AfDB has approved a $40 million equity investment in Project Zafiri.
** For the best experience, download the free Africa Private Equity News app Android | iOS **
The African Development Bank (AfDB) has approved a $40 million equity investment in Project Zafiri to accelerate the expansion of renewable energy access across Africa.
Zafiri – jointly developed by the AfDB, World Bank Group and other partners – aims to address the critical shortage of patient, longer-term equity capital needed to de-risk and scale decentralised renewable energy (DRE) solutions for underserved communities across the continent.
Unlike centralised grids, DRE solutions – such as mini-grids and stand-alone solar home systems – can be deployed quickly and affordably, even in remote or fragile areas.
Zafiri is structured as a permanent capital vehicle with a targeted capitalisation of $1 billion, raised through a phased approach. Phase 1 targets $300 million in total commitments, equally split between junior and senior equity, with junior equity serving as a key catalyst to crowd-in private sector in this higher-risk, undercapitalised market.
The AfDB’s $40 million contribution consists of $30 million in senior equity from its balance sheet and $10 million in junior equity from the Sustainable Energy Fund for Africa (SEFA), a multi-donor special fund managed by the bank.
Stay ahead in Africa's private equity and venture capital sector with Africa Private Equity News’ monthly Dealmaker’s Log – a database of reported investment deals, exits, and fundraising closes. Subscribe here