French investment of 87.5 million euros to boost African solar power

French investment of 87.5 million euros to boost African solar power

French fund manager RGREEN INVEST and investment adviser ECHOSYS INVEST said on Friday that a new investment fund with 87.5 million euros ($92.63 million) will finance solar power production across Africa, with a concentration on West and Central Africa.

According to the announcement, the first close of the AFRIGREEEN Debt Impact Fund would fund on- and off-grid solar power facilities for small- and medium-sized commercial and industrial clients across the continent.

Direct loans for solar power companies

For the development of solar infrastructure, the project proposes to offer direct loans and asset-based debt facilities to regional, global, and African commercial and industrial firms.

In order to achieve their long-term debt financing needs of between 10 and 15 million euros, with an average of roughly 5 million euros over eight to ten years, the groups are aiming to have a portfolio of 20 to 30 assets, according to the statement.

Investors will control the success of solar power businesses

The fund also offers long-term local currency financing in Ghana and Nigeria. It is with assistance from the Private Sector Window Local Currency Facility of the International Development Association.

The Fund’s effect goals would be measured in terms of installed megawatts (MW), megawatt-hours (MWh), tonnes of CO2 emissions, liters of fuel avoided, and the number of businesses that directly or indirectly use new funding channels, it was announced.

The impact will also be gauged by how many commercial and industrial businesses are able to modernize and increase the effectiveness of their power-producing facilities.

Who are the investors?

According to RGREEN INVEST and ECHOSYS INVEST, the European Investment Bank (EIB) and the International Finance Corporation made commitments for the first closing (IFC).

According to the release, the French banks Societe Generale and BNP Paribas completed the first round of fundraising.

The company hopes to raise a total of 100 million euros from private investors and development financing organizations.

French investments in solar energy in Africa

France has been actively investing in solar energy in Africa in recent years. The French government and several French companies have made significant commitments to develop solar power infrastructure on the African continent. Some of the key initiatives include:

The French Development Agency (AFD) has committed to investing 6 billion euros. The investment will be in renewable energy projects in Africa by 2022, with a focus on solar power.

French energy company Total has invested in several African solar projects. It includes a 25 MW solar power plant in Burkina Faso and a 50 MW solar power plant in Nigeria.

Supporting solar power in Africa follows the global trend

In 2019, French President Emmanuel Macron launched the “International Solar Alliance” with Indian Prime Minister Narendra Modi. The alliance aims to promote the use of solar energy in developing countries, particularly in Africa.

In 2020, France announced the creation of a 1.2 billion euro fund to support African renewable energy projects, including solar.

France’s investments in solar energy in Africa reflect a growing global trend towards sustainable development and clean energy. It is a recognition of the potential for solar power to transform energy access and economic development in Africa.