A total of 900,000 households in sub-Saharan Africa representying about 4.5 million people are expected to gain access to solar power by 2025, the Vice-President for Power, Energy, Climate Change, and Green Growth at the African development bank (AfDB), Wale Shonibare confirmed Wednesday.
The statement issued by the bank said that this initiative is part of innovative multinational financing program for Distributed Energy Service Companies (DESCOs).
The DESCOs Financing Program promotes securitization financing techniques to address barriers to accessing finance for DESCOs, while supporting their growth and expansion into existing and new markets, it
The Board of Directors of the African Development Bank Group has approved EUR 50 million guarantee facility and EUR 6 million technical assistance grant by the European Fund for Sustainable Development for the implementation of the above project, it said.
During the implementation phase, the program will contribute to installation of an estimated 45 MW of distributed solar PV which will provide clean energy access for 900,000 households by 2025.
It will also create approximately 6,000 new direct jobs, mainly for the youth, and contribute to avoidance of nearly 37.08 kilotons of CO2eq emissions per year, the statement said.
Reacting on the move, the senior bank manager stressed that accelerating access to universal, affordable, reliable, sustainable and modern energy for underserved populations requires innovative financing solutions.
“Innovations such as receivables-backed financing structures provided by the program are vital in the Bank’s efforts to unlock private sector participation and local currency financing for the energy sector,” Shonibare said.
Solar home systems present commercially viable, climate resilient, and modern solutions to provide clean energy access to off-grid populations in Sub-Saharan Africa, experts said this projct is also a great example of collaboration between the European Commission and the African Development Bank.
“This program will enhance the impact of DESCOs by enabling them to access financing that is tailored to their operations” said Dr. Daniel Schroth, the Bank’s Acting Director for Renewable Energy and Efficiency.
CU/abj/APA