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Daily Briefing: AfDB Secures $90m in New Donor Funds to Transform the Sustainable Energy Fund for Africa

The African Development Bank (AfDB) announced $90 million in new donor commitments for the Sustainable Energy Fund for Africa (SEFA). The new SEFA Special Fund is expected to expand, be more flexible, as well as more responsive to Africa’s fast changing energy market, with a sharper focus on green mini-grids and green baseload, and offering a wider array of catalytic finance instruments.

“Denmark has the development goal of providing clean energy to 5.8 million people in Africa. SEFA has proven that it has the capacity to implement innovative renewable energy projects – even in difficult circumstances. Therefore, Denmark is a close partner with SEFA – and we are pleased to be able to continue the work of providing clean energy to all,” said Danish Minister for Development Cooperation, Mr. Flemming Møller Mortensen, who was represented by Stephan Schönemann, Under-Secretary for Development Policy with the Danish government.

Denmark, SEFA’s founding partner and first donor, also unveiled DKK 65 million ($10.65 million) in fresh commitments; it was also announced during the launch that Germany and the Nordic Development Fund (NDF) became SEFA donors in 2020. Germany extended €50 million ($60.97 million) to support SEFA’s green baseload activities, which aim to promote more sustainable baseload power generation options and prevent countries from locking themselves into environmentally damaging and potentially economically costly technologies.

“Climate change is advancing fast and knows no borders, we can only tackle it together and in solidarity. For many years, the African Development Bank is a trusted partner for Germany and one of the most important driving forces behind a structured energy transition in Africa,” said Maria Flachsbarth, Parliamentary State Secretary of the German Ministry of Economic Cooperation (BMZ).

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NDF Managing Director Karin Isaakson, announcing a €10 million ($12.19 million) commitment, noted: “SEFA’s proven capability to promote early-stage projects, businesses, and markets, as well as to design and implement new and innovative financing structures and mobilise additional funding fits well with NDF’s strategic pathways. We look forward to identifying opportunities to co-create new climate finance instruments together with SEFA.”

Other significant funding came from the Swedish International Development Cooperation Agency, which has committed 75 million Swedish Krona ($8.98 million). The governments of the United States and the United Kingdom also affirmed their continued support for SEFA.

SEFA, managed by the Bank, is a special fund providing catalytic finance for renewable energy, with the goal of contributing to universal access to affordable, reliable, sustainable, and modern energy services for all Africans. The Fund was established in 2011 in partnership with the Danish government. The governments of the United States, United Kingdom Italy, Norway, Spain, Sweden, and most recently Germany and the NDF are donors.

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Notable achievements include the Africa Renewable Energy Fund, the Facility for Energy Inclusion) and the Green Mini-Grid Market Development Programme. SEFA has also supported various developers in bringing their projects to fruition and advised countries on designing innovative renewable energy and energy access programmes.

Kevin Kariuki, African Development Bank Vice President for Power, Energy, Climate and Green Growth acknowledged the key role the fund has played in building African market-building as well as its centrality to the Bank’s strategic vision. “I am indeed very proud to observe that SEFA is a key enabler of the New Deal on Energy for Africa, a partnership-driven goal to ensure Access to Affordable, Reliable, Sustainable and Modern Energy for All, launched by the African Development Bank in 2016,” he said.


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