Fundraising

Power Africa seals $1bn in fresh commitments

Projects backed under the initiative include a $220m solar farm in Nigeria, a $300m dual-fuel power plant in Senegal and pan-African debt platforms.

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Power Africa, an initiative launched by US President Barack Obama to help catalise third-party investment into African energy, yesterday announced sealing $1 billion in fresh commitments towards several projects.

The US government, which initially pledged $7 billion to the initiative, says its capital injection has helped leverage more than $52 billion in external commitments since inception, including more than $40 billion in private sector commitments to invest in generation and distribution across sub-Saharan Africa.

Power Africa is currently tracking more than 500 deals across the continent, USAID, the US government’s aid agency, said in a statement.

Among them are a number of regional initiatives, including a $300 million debt facility established by Standard Bank of South Africa, the Overseas Private Investment Corporation and Wells Fargo, the creation of which was announced yesterday. At least half of the money has been earmarked for power, with up to $100 million also available for infrastructure projects in other sectors.

Large-scale, individual projects in single countries also form a feature of the initiative, including a $220 million, 100MW solar plant in Nigeria backed by Nigeria Solar Capital Partners, Globeleq Africa and the ARM-Harith Infrastructure Fund.

Also on the list is Senegal’s 158MW Taiba N'Diaye wind farm, which is backed by Lekela Power, a platform created by emerging market firm Actis and developer Mainstream Renewable Power, as well as a $300 million, 200MW dual fuel power plant in the same country, sponsored by the Senegalese government and Blackstone portfolio company Black Rhino.

While Power Africa says it is on track to disburse its target $7 billion commitment, critics say the initiative has so far yielded less than 400MW out of the 10GW of new generating capacity it initially aimed to unlock. Defenders reply that building the infrastructure does not happen overnight.

“Three years after launching Power Africa we’re seeing real progress,” Obama said at the US-Africa Business Forum in New York yesterday, during which the new commitments were announced. “By 2030, I believe we can bring electricity to more than 60 million African homes and businesses.”