The Board of Green Climate Fund (GCF) has approved $170.9 million dollars in financing for the African Development Bank’s (AfDB) Leveraging Energy Access Finance Framework (LEAF) programme, a statement from the AfDB said on Wednesday.
LEAF aims to unlock commercial and local-currency financing for decentralised renewable energy (DRE) projects in six programme countries: Ghana, Guinea, Ethiopia, Kenya, Nigeria and Tunisia.
The climate financing is part of an overall $900-million-dollar programme budget with the aim of scaling up roll-outs of mini-grids, solar home systems, commercial and industrial solar solutions in the programme countries.
Mr Tony Clamp, Acting Director, Private Sector Facility, GCF expressed delight in partnering with the AfDB to support the timely and critical programme for decentralised renewable energy across the six African countries.
“Green Climate Fund’s commitment will help unlock the much-needed commercial capital and local currency financing to help overcome financing barriers exacerbated by COVID-19.”
Mr Kevin Kariuki, Vice President for Power, Energy, Climate and Green Growth at AfDB, described the approval of LEAF as a significant boost to the bank’s electricity and energy plans.
“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 decentralised renewable energy solutions and moreover, facilitated through local financing.”
LEAF would be harnessed to provide renewable energy to six million people and businesses and would also prevent 28.8 million tonnes in CO2 emissions over the lifetime of the systems.
The framework is also expected to strengthen capital markets and crowd-in private sector investors, including local financial institutions.
In addition, it is expected that the financial and technical capacity to finance businesses of the institutions would be enhanced in the fast growing DRE market segment, comprising solar home systems, green mini-grids and solar solutions for commercial and industrial sectors.
The program would also provide requisite support to strengthen the enabling environment and increase private sector investment in this market segment.