Investors and finance institutions are ramping up commitments to African off-grid renewable energy projects in a bid to boost the continent's electricity generation capacity.
On Monday, the French Development Agency (AFD) agreed to finance over 10MW of micro-grid renewables projects in Kenya for €33 million. The loan will go towards funding 9.6MW of solar and 0.6MW of wind energy in 23 micro-grids currently powered by diesel generators. The loan is part of a long-term energy partnership between Kenya and AFD, which has committed over €800 million to the Kenyan power sector since 2000.
Also this week, Tanzania-based Off Grid Electric closed an $18 million financing for its distributed solar home and batteries product. The company received a $10 million commitment from Helios Investment Partners and $8 million of debt from ResponsAbility Investments.
A report published in March by the International Finance Corporation and the World Bank said the global off-grid solar industry is poised to reach $3.1 billion by 2020. Less than 10 years ago, there were almost no off-grid companies serving emerging markets, the paper stated, noting that there are now over 100 businesses focusing on standalone and solar home kits for those without energy access.
CrossBoundary, another company offering micro-grid solar products, closed its first fundraising round last year on $8 million. The proceeds will be used to finance micro-solar projects of 0.2MW to 10MW for commercial customers in Africa.