AfDB, NDF Lift AfricaGoGreen Fund With Over $30m Equity Investments

Posted by African Examiner Business News, Latest Headlines Friday, March 11th, 2022

The African Development Bank (AfDB) and Nordic Development Fund (NDF) have made a combined-equity investments amounting to over $30 million in the AfricaGoGreen Fund.
AfricaGoGreen Fund is a debt fund established to promote private investments in energy-efficient technologies and business models, with the objective of decarbonising African economies and accelerating the energy transition.
Launched in early 2021 with €45 million in catalytic capital, the AfricaGoGreen Fund is a flagship project under the G20 Compact with Africa. The Fund provides flexible and tailored debt instruments to private businesses in green appliances for domestic and industrial processes, green buildings, e-mobility solutions, and battery energy storage projects. It is managed by LHGP Asset Management, part of the Lion’s Head Global Partners group.
Through its Sustainable Energy Fund for Africa (SEFA), AfDB recently approved $20 million investment in the AfricaGoGreen Fund, in addition to the $11.5 million equity contribution approved by the NDF in December 2021.
NDF provides financing to climate change mitigation and adaptation activities within the nexus of climate change and development. NDF is also a donor to SEFA, thus reinforcing the close partnership to advance the transition to cleaner and greener solutions for the continent while encouraging the participation of the private sector.
The Fund is the joint Nordic international finance institution of the five Nordic countries which include, Denmark, Finland, Iceland, Norway, and Sweden. NDF focuses on the nexus between climate change and development in lower-income countries and countries in fragile situations.
Since the introduction of the climate mandate in 2009, NDF has built a track record of adding value by financing climate mitigation and adaptation projects in close interaction with its extensive network of strategic partners.
Similarly, SEFA is a Multi-Donor Special Fund that aims to unlock private sector investments that contribute to providing universal access to affordable, reliable, sustainable, and modern energy services for all in Africa, in line with the AfDB’s New Deal on Energy for Africa strategy and Sustainable Development Goal 7.
AfDB’s Vice President for Power, Energy, Climate and Green Growth, Dr. Kevin Kariuki said this combined Bank investment will lead to increased financing of emerging projects and businesses in the areas of industrial appliances, electric mobility and green buildings, which are key to the decarbonization of African economies and to a just energy transition.
Director for Portfolio Origination and Management at the NDF, Mr. Henrik Franklin noted that achieving the climate goals and universal access to clean and affordable energy will require vast investment in energy efficiency and, more broadly, in electrification and other sector coupling trends.
“By targeting these emerging sectors in Africa, AGGF complements our climate and energy access portfolio, and is aligned with our strategic role as an early-stage catalytic investor”, he added.
While applauding the efforts, the Director Global Equity and Funds for KfW Development Bank, Martin Witte expressed his delight and appreciation.
“We are really happy to see the Bank, SEFA and NDF as new investors in AGGF. These new investments are also expected to trigger additional investments by commercial investors and financiers either directly or through co-funding of projects”, he stressed.
Speaking in a similar vein, Clemens Calice, Co-CEO and founding partner of Lion’s Head Global Partners said they are excited to welcome the AfDB, SEFA and NDF as investors to the AfricaGoGreen Fund.
The Fund will take efforts to transition to a lower-carbon economy a step further by offering financing to innovative African companies that embrace energy efficiency as a challenge and an opportunity”, he further explained.
Notably, AfricaGoGreen Fund approved its first deal in August 2021, a loan to AktivCo – a company that finances clean energy solutions for powering telecommunication towers located in Burkina Faso, Cameroon, Chad, Côte d’Ivoire, and Niger.
Also,in December 2021, it made an additional approval of a $5.5 million loan to BBOXX, a technology company exploring energy solutions that would provide electricity and other utilities to the millions without them, for the expansion of access to clean cooking solutions.