Date: 13 Sep 2018
The Off-Grid Energy Access Fund (OGEF) has announced its first close with committed capital of $58m from the African Development Bank (AfDB), the Nordic Development Fund, the Global Environment Facility, Calvert Impact Capital and All On.
“OGEF is the result of a strong partnership between our institutions and a perfect case study for making blended finance work for climate, green growth and the Sustainable Development Goals,” said Pasi Hellman, Managing Director at the Nordic Development Fund.
"OGEF squarely fits within our investment mandate of leveraging public capital at scale to create systemic change in sectors and geographies that have been overlooked by mainstream capital markets. We are excited to work with this group of committed investors to scale this facility and increase access to clean electricity for off-grid households in Africa," added Jenn Pryce, President and CEO of Calvert Impact Capital.
The Fund is part of the AfDB’s sponsored Facility for Energy Inclusion (FEI), a $500m debt platform to catalyse capital markets support for innovative energy access strategies.
OGEF is designed to provide flexible debt instruments, predominantly oriented around local currency lending for consumer finance, to companies in the household energy access sector including distributors, manufacturers, and end-user credit providers.
The Fund supports financially sustainable transactions that engage local capital markets to increase access to clean electricity for underserved households.
OGEF has received significant technical and financial support from key Bank partners, namely the UK’s Department for International Development, the US Government’s Power Africa initiative and the Shell Foundation.
João Duarte Cunha, Manager for Energy Initiatives and Partnerships at the bank, further underscored that “this broad partnership is a reaffirmation of the Bank’s catalytic role in financing renewable energy projects of all scales across Africa”.
LHGP Asset Management, a UK Financial Conduct Authority-regulated alternative fund manager, from Nairobi, Lagos and London, manages OGEF.
“The energy access sector demonstrates the vibrancy and innovation in Africa for market solutions to fundamental challenges. LHGP is excited to be the manager of OGEF and engage local capital markets towards the goal of connecting millions of households to electricity”, said Clemens Calice, LHGP Partner.
Wiebe Boer, CEO of Nigeria-based All On, an off-grid energy impact investment company backed by Shell, said: “We see OGEF as a great opportunity for public and private investors to work together to address Africa’s significant access to energy gap. We look forward to working with LHGP, especially the Lagos office, to build a solid portfolio of off-grid energy companies that are improving livelihoods by providing affordable power to un- and underserved communities.”
“Shell Foundation is delighted to support the first close of OGEF. We believe that these funds will make a meaningful difference to companies delivering access to energy across Africa,” commented Pradeep Pursnani, Deputy Director, Shell Foundation.